FTC Warns of Bitcoin ATM Scams

The US FTC has warned US residents of Bitcoin ATM scams, which have risen 10X since 2020.

The US Federal Trade Commission has warned US Bitcoin users of scams involving ATMs that allow Bitcoin transfers. Fraudsters are increasingly using ATMs as a means to get people to transfer assets to their wallets.

Source: FTC on X

In a blog posted to its website, the FTC warned readers, “Is there a legit reason for someone to send you to a Bitcoin ATM? The short answer is NO. Will someone from the government send you to a Bitcoin ATM? NEVER.” It informed that scammers persuade users to act quickly to protect their bitcoin and ask them not to let anyone know, including close friends and family members. After inciting this panic, they ask users to protect their at-risk bitcoin by moving it elsewhere. “No matter what the caller says, there’s no such thing as a government Bitcoin account or digital wallet. There are no Bitcoin federal safety lockers,” the FTC said.

Furthermore, the agency offered tips to not fall for the scams, which include never moving their funds to ‘protect’ them, calling the related bank, investment advisor, or broker, and reporting the scammer to the FTC.

Bitcoin ATM Scams Up Tenfold Since 2020

A recent CNBC report citing FTC data noted that Bitcoin ATM scams have risen 10X since 2020. 2023 alone saw scammers draw over $110 million using ATMs to part users from their bitcoin. It also mentioned how people over the age of 60 are three times more vulnerable to falling for these tactics.

“In many of the incidents the FTC identified, fraudsters contact a victim — or the victim inadvertently connects with them — claiming to be a customer service representative flagging an attempted identify theft or an account breach,” the CNBC report read. The victim is then sent a QR code, which, upon scanning, initiates a transaction that would be fulfilled after depositing cash into an ATM. “The victim is typically directed to scan the code and deposit cash into the Bitcoin ATM, which converts it into bitcoin that immediately gets transferred to the scammer — all while the victim thinks they’re protecting their assets.”

While that is one way a lot of these scams occur with users already holding bitcoin. Scammers use these ATMs as tools to get them to transfer assets to their wallet addresses.