It is well known that scammers want to be “paid” with methods that are difficult to reverse. Some of the classics include wire transfers, peer-to-peer transactions, and gift cards. The suggestion of using any of these methods is often used as a red flag that the transaction is suspect and that you should stop communicating with the person who suggests them.
Scammers have added a new method to transfer money to them, cryptocurrency.
Converting regular money to or from a cryptocurrency can be done in one of two
ways,
·
Cryptocurrency exchange. A cryptocurrency exchange is a digital
marketplace where you can buy, sell, and trade cryptocurrencies. You can send cryptocurrency
to your personal cryptocurrency wallet or to another wallet through an exchange.
Users need to create an account and deposit funds. They can also use a digital
wallet to securely store their currency.
·
Cryptocurrency kiosks. A Cryptocurrency kiosk is a kiosk that
looks similar to an ATM, that can be found in high traffic areas such as convenience
stores, gas stations, or malls. You can use a crypto kiosk for quick access to
your digital wallet, convert cash to a cryptocurrency, pay bills, or transfer
funds to another person such as a family member or friend.
Crypto kiosks are considered easier to operate than an exchange in
some ways. All you have to do is walk up to the kiosk, like an ATM, insert cash
or a debit card, then send the money on its way in a few steps. You do not have
the complications of a crypto exchange. This makes it easier for scammers to
instruct victims to send their money. And, once the money is in the scammer’s
wallet, the scammer can easily and quickly launder the money so that it is impossible
for the victim to recover their funds.
Crypto kiosks have been so successful for scammers that the FBI received
13,400 complaints through its Internet Crime Complaint Center (IC3) in 2025
amounting to $388 million in losses, a 23% increase in complaints and 58%
increase in losses over 2024. Of those totals, Washington State had 391
complaints for losses of $8,341,828.
While there are legitimate uses for crypto kiosks, the Iowa
Attorney General found that in 2025 at least 94% of transactions from at least
two crypto kiosk providers (Bitcoin Depot and CoinFlip) were fraudulent. In
addition, money launderers, drug traffickers, and human traffickers have been
reported using crypto kiosks to quickly and anonymously move and launder money.
Scammers have been using the kiosks in all sorts of scams
including government impersonation scams, tech support scams, romance and
investment scams, and prize and employment scams. Once the scammer convinces
the victim that they need to pay or “invest” their money, the scammer will send
a QR code to the victim with the address of the scammer’s crypto wallet. The scammer
instructs the victim to withdraw cash from their bank, then to go to a nearby
crypto kiosk. Sometimes, the scammer will keep the victim on the phone
throughout the process to give detailed instructions and to ensure that the
victim complies with those instructions.
The use by scammers of crypto kiosks has caught the attention of
state legislators throughout the U.S. Several states have passed legislation
that regulates the kiosks for the protection of the public. The Washington
State Legislature considered Senate bill 5280, “Protecting consumers of virtual
currency kiosks.” The bill passed in the Senate but was sent back to committee by
the House. If passed in the future, the bill would
• Cap daily
transactions at $2,000 per consumer.
• Limit fees to
$5 or 15% per transaction (whichever is greater).
• Require paper
receipts for all transactions.
• Post clear,
visible scam warnings on every kiosk.
Legislation like this attempts to give at least some protection for
consumers. The limit to $2,000 in transactions per day tries to limit the
potential loss that a consumer might experience if they are being scammed. Transaction
fees at crypto kiosks tend to be higher than for crypto exchanges. The limit to
the fees tries to prevent gouging by the kiosk owners. Paper receipts provide
proof of the transactions in case a consumer needs to report a scam to police. Finally,
scam warnings attempt to educate the public of the opportunity of scams and encourage
kiosk users to slow down and be thoughtful about an upcoming transaction.
Federal Trade Commission:
Consumer Affairs:
https://www.consumeraffairs.com/news/crypto-kiosks-are-being-used-to-run-multiple-scams-052226.html
FBI:
https://www.ic3.gov/PSA/2026/PSA260515-2
AARP:
https://www.aarp.org/advocacy/crypto-atm-fraud-protections/
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