Albuquerque has adopted a citywide ban on cryptocurrency ATMs, following a unanimous city council ordinance passed on Wednesday. The new regulation also prohibits cashier-facilitated virtual currency transactions, targeting both machine operators and the businesses hosting these kiosks.
Crypto ATM removal deadline set
City officials stated that operators and retailers with crypto ATMs inside Albuquerque have 45 days from notification to remove their machines. The measure comes amid growing concerns about fraud and scams associated with these kiosks, especially in vulnerable neighborhoods.
City councilor Fiebelkorn emphasized the urgency of action, suggesting that federal regulations have not moved quickly enough to protect local residents. “We cannot wait for federal regulators to solve this crisis while our residents are actively being targeted and harmed in our own neighborhoods,” Fiebelkorn stated.
City councilor Fiebelkorn highlighted the need for local intervention due to persistent targeting and harm in Albuquerque neighborhoods.
Despite the ban, individuals in Albuquerque can still own, mine, and transfer cryptocurrencies using online exchanges or personal wallets. The restriction solely affects physical kiosks and in-person cashier services that facilitate direct crypto transactions.
Nationwide crackdown on crypto ATMs
Albuquerque’s decision mirrors similar restrictions enacted across several US states. Indiana became the first state to issue a ban in March. Tennessee imposed its prohibition in July. Minnesota’s ban, introduced in the spring, took effect by August. Delaware has moved forward with legislation, New Jersey has a bill under consideration, and Texas lawmakers are debating their own proposals. The move in Texas follows reports of $57 million lost by residents due to kiosk-related scams.
Some US legal authorities have cited high fraud rates as justification for these actions. In a notable example, the attorney general for Washington, D.C., filed suit against Athena Bitcoin after finding that 93% of deposits at the company’s seven city kiosks over five months stemmed from fraudulent activity, predominantly targeting the elderly. Athena has disputed these allegations.
The FBI recorded nearly 11,000 fraud complaints linked to crypto kiosks so far in 2024, with losses exceeding $246 million.
| Location | Status of Crypto ATM Ban | Ban Effective Date |
|---|---|---|
| Indiana | Banned statewide | March 2024 |
| Tennessee | Banned statewide | July 2024 |
| Minnesota | Banned statewide | August 2024 |
| Delaware | Advanced bill | In progress |
| New Jersey | Bill under discussion | In progress |
| Texas | Ban under discussion | In progress |
| Albuquerque, NM | Banned citywide | June 2024 |
Impact on operators and industry
The mounting federal and local restrictions have dealt a major blow to the US crypto ATM industry. Bitcoin Depot, once the largest Bitcoin ATM provider in North America, filed for Chapter 11 bankruptcy in May 2024. The Atlanta-based company operated over 9,700 kiosks before shutting down its network. CEO Alex Holmes attributed the closure to stricter transaction limits and outright bans implemented in some areas, which he said made their business model unsustainable.
Bitcoin Depot, listed on the NASDAQ, once operated thousands of machines across multiple states. The company faced mounting compliance costs and tightening regulations before its collapse.
The industry’s declining fortunes are partly tied to concerns over consumer safety, as demonstrated by increasing reports of scams and fraud linked to crypto ATMs. Telles, a local official in Albuquerque, estimated that scams comprise a significant portion of transactions at these kiosks. While the figure is high, national data suggests that fraud is widespread across the industry.
Mini dictionary: Bitcoin Depot, founded in 2016 in Atlanta, was North America’s largest crypto ATM operator before bankruptcy. The company offered users a way to buy and sell crypto for cash at physical kiosks, providing access to digital assets outside of traditional banking channels.
Bitcoin Depot’s CEO linked the company’s bankruptcy to “increasingly stringent compliance obligations, transaction limits, and, in some jurisdictions, outright restrictions or bans.”
