Security

Are bitcoin ATMs doomed?

Bitcoin ATMs are under attack. Can they survive?

Photo: Adobe Stock

April 14, 2026

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"There are decades where nothing happens, and there are weeks where decades happen," is a quote often attributed to Vladimir Lenin. It rings true in many circumstances, especially with bitcoin ATMs.

After long outcries regarding the rise in scams, to the tune of $333 million in losses in 2025, states are taking drastic measures. Indiana became the first state to ban the devices entirely. Tennessee lawmakers passed a ban as well, and are simply awaiting a signature from its governor. Other localities are joining in, and Minnesota is debating a ban currently.

Amid this clamor, other states are taking more cautious approaches, such as requiring refunds for victims, such as South Dakota. However, all this activity has raised concerns over whether the bitcoin ATM industry will survive this current trend. Are bitcoin ATMs doomed or can they find a way out?

ATM Marketplace spoke with Joe Ciccolo, founder and president for crypto compliance company, BitAML and Lonnie Talbert, chief industry executive for ePayResources and president of ATMIA for more insights into the fate of bitcoin ATMs.

Q: What is your initial reaction to these bans?

Ciccolo: I was somewhat surprised. To date, most states have approached crypto kiosks through targeted consumer protection measures rather than outright bans. These typically include transaction limits, fee caps, enhanced disclosures, and scam warnings, all aimed at reducing consumer harm while preserving access.

At the same time, I am concerned. History shows that prohibition often pushes activity into less transparent channels. When you remove a regulated, visible access point like a kiosk, consumers do not necessarily stop transacting; they shift elsewhere. We are already seeing scammers pivot to directing victims to withdraw cash and meet in person with couriers, which is significantly more dangerous. There has also been increased use of precious metals in scams, an area with comparatively less oversight and fewer compliance safeguards. So the risk does not disappear; it migrates, often to environments with far fewer protections.

Talbert:I think these bans are once again a "knee jerk" reaction to not fully understanding an issue and the easiest way to deal with it is to not have to actually understand the challenge and develop a more holistic solution. I have always said we can't legislate our way out of an issue.

Q: Scammers have always taken advantage of payment methods from wire transfers to gift cards. Why are bitcoin ATMs treated differently?

Ciccolo:That is an important question. Fraud is not new, and scammers have long exploited whatever payment rails are available, including wires, prepaid cards and gift cards.

What is different here is a combination of perception and visibility. There have been several high-profile media investigations that have brought negative attention to crypto kiosks, often highlighting worst-case scenarios. At the same time, many policymakers are still developing a working understanding of how these machines function, which can lead to misconceptions about their role in illicit activity.

There are also practical factors. Fees at some kiosks are higher than other financial products, and policymakers sometimes question the consumer value proposition, particularly when lower-cost alternatives exist. All of this contributes to a narrative that elevates kiosks as a focal point, even though the underlying issue, scams exploiting payment systems, is much broader.

Talbert: Due lack of understanding of the type of payment format and it being new and too much disinformation. The people making the decisions are being led to believe that all things crypto are bad due to lack of understanding and full spectrum information.

Q: What would you recommend bitcoin ATM operators do to mitigate the risk of bans?

Ciccolo: Operators should continue to lean into consumer protection and make it highly visible. That includes strengthening scam prevention measures, lowering fees where possible and clearly demonstrating the legitimate use cases for these services.

Equally important is proactive engagement with policymakers and regulators. Education goes a long way. When stakeholders understand how kiosks operate, the controls that are in place and how they compare to other payment channels, the conversation becomes more balanced.

In short, the industry should focus on transparency, consumer protection and education. Those three elements are critical to maintaining trust and avoiding overly restrictive policy outcomes.

Talbert:Get ahold of their respective legislators and get them educated with factual and correct information regarding bitcoin and digital assets. Be open and honest about the challenges but ask to be apart of the solution.

Q What are common-sense features operators should implement to mitigate scams or help victims?

Ciccolo: There are several practical steps that can make a meaningful difference:

• Strong, responsive customer support, including real-time assistance when transactions appear suspicious
• Enhanced onboarding for new users, such as outbound calls or additional verification before first transactions
• Clear, prominent scam warnings on-screen before and during transactions
• Lower transaction limits for new or first-time users, with gradual increases over time
• Behavioral monitoring to flag unusual activity patterns
• Easy-to-use reporting and refund escalation processes for suspected fraud

In addition, operators should continuously gather and incorporate customer feedback to better understand how people are using kiosks and where protections can be improved.

Included In This Story

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ATM Industry Association (ATMIA)

The ATM Industry Association, founded in 1997, is a global non-profit trade association with over 10,500 members in 65 countries. The membership base covers the full range of this worldwide industry comprising over 2.2 million installed ATMs.

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