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FTC reports crypto ATM scams up 1,000% since 2020 and $388 M lost in 2025, prompting bans in Indiana, Tennessee and Minnesota.
A FTC report shows cryptocurrency ATM fraud losses jumped 1,000 % from 2020 to 2023 and reached $388 million in 2025, a 58 % rise over the prior year, underscoring a rapid escalation of crypto‑related scams【2】.
| At a glance | |
|---|---|
| Scam loss increase | 1,000 % (2020‑2023) |
| 2025 loss amount | $388 million |
| Year‑over‑year rise | 58 % (2025 vs 2024) |
| Avg loss for victims 60+ | $10,000 per person |
Crypto ATMs look like traditional machines but dispense cryptocurrency instead of cash. Their anonymity and instant transfer capability make them attractive to fraudsters who pose as law‑enforcement officers, government officials, or tech‑support agents. Victims are pressured to withdraw cash, scan a QR code, and deposit the funds into a wallet controlled by the scammer under the pretense of “protecting” the money or paying for a bogus service【2】. Because crypto transfers are irreversible, once the victim sends the cash the funds disappear.
The FTC labeled crypto ATMs a “payment portal for scammers” in a 2024 report, prompting several states to act. Indiana became the first state to ban crypto ATMs in March 2026, followed by Tennessee (effective July 1 2026) and Minnesota (effective August 1 2026)【2】. Meanwhile, Massachusetts sued Bitcoin Depot after an investigation found that more than half of the transactions through its ATMs between August 2023 and January 2025 were linked to scams【2】. Other states such as South Dakota, Arizona, Colorado, Arkansas, and Virginia have imposed restrictions without outright bans.
Beyond ATM fraud, scammers routinely use scripts that create urgency, trust, and promised rewards. Common tactics include fake investment offers promising rapid returns, romance scams that evolve into crypto‑trading pleas, and impersonations of government agencies demanding crypto payments to “resolve” alleged tax or security issues【1】. Victims are often lured by convincing screenshots of profits or small early withdrawals, only to lose larger sums once the scammer cuts off contact. The irreversibility of crypto transactions and the general public’s limited understanding of blockchain mechanics amplify these risks.
The surge in crypto ATM scams highlights how quickly criminal actors can weaponize emerging financial infrastructure, raising questions about the balance between innovation and consumer protection in the digital asset ecosystem.
Coverage is mostly measured — 147 of 149 reports stay neutral.
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AI-assisted synthesis by the TrendWatcher Editorial Desk · sourced from 2 outlets · Jul 5, 2026 · How we report
They lure victims to connect their wallets to fraudulent DApps, where users approve unlimited token allowances that attackers later use to transfer assets.
The Binance Smart Chain accounts for a large share of drainer incidents, driven by its low transaction costs and popularity among retail DeFi users.
Wallet drainer attacks stole roughly $494 million and impacted more than 332,000 addresses worldwide.
Rug pulls involve developers abandoning projects after raising funds, whereas drainer scams rely on victims voluntarily granting token approvals to malicious contracts.
More than half of FBI‑reported scam losses in 2025 involved cryptocurrency, with victims reporting nearly $11.4 billion in crypto‑related incidents.