Americans lost $333 million to crypto ATM fraud last year alone. This staggering number is at the heart of why Bitcoin Depot, the nation’s largest Bitcoin ATM operator, has made fundamental changes to the way it does business. The changes affect everyone who comes near the company’s machines.
Starting in February, the company began implementing requirements for customers to show identification not only when signing up for the first time, but also before completing a transaction. No ID or Bitcoin. It’s very simple.
History of half major
It’s not like Bitcoin Depot hasn’t tried to address fraud before. Back in October 2025, the company introduced identity checks for new users joining the platform. But are there any returning customers? They were able to continue trading without further scrutiny. Critics argue that the gap was wide enough for the bad guys to slip through, and the numbers suggest that’s exactly what they did.
FBI data on cryptocurrency ATM fraud losses last year makes it impossible to ignore the scale of the problem. Many scammers target older Americans and have perfected a disturbing routine. They use false pretenses, such as fake government notifications or fake tech support calls, to lure victims into depositing cash into Bitcoin ATMs, then disappearing once the money is cleared. Victims are almost always left with nothing, as Bitcoin transactions cannot be reversed.
Legal heat from all directions
Bitcoin Depot isn’t just about bad headlines. We have been working with lawyers. Earlier this month, Massachusetts Attorney General Andrea Campbell filed a lawsuit against the company, alleging that the company knowingly allowed cryptocurrency fraud to occur while stripping away fraud protection.
Campbell’s office asked the court to prevent Bitcoin Depot from accepting transactions over $10,000 unless additional fraud prevention measures are taken.
Maine told a different story — one that came with a price tag. The company agreed to refund fraud victims and reached a $1.9 million settlement with the state’s Consumer Credit Bureau. And the Iowa Supreme Court, somewhat controversially, ruled that Bitcoin Depots are legally allowed to deposit cash fraudulently because customers must verify that they own the receiving wallet.
At least 17 US states have reportedly passed laws requiring increased protections for crypto ATMs, such as daily spending limits and clearer fraud warnings posted on machines.
9,000 machines, 1 new rule
The scope of influence of Bitcoin Depot is enormous. The company operates more than 9,000 kiosks across North America, according to the report, and is the dominant player in the U.S. market, which accounts for 78% of Bitcoin ATMs worldwide (more than 31,000 total), according to data from Coin ATM Radar.
CEO Scott Buchanan positioned the new ID policy as a security upgrade, not just a legal shield. “By requiring identity verification for all transactions, we are taking additional steps to strengthen security, protect our customers, and maintain the integrity of our service,” he said.
The company says continuous verification allows it to flag suspicious activity related to a specific customer, location, or amount before a transaction is approved.
Featured image from Unsplash, chart from TradingView
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