AUSTRAC Imposes Cash Limits and Enhanced Due Diligence as Scam Losses Top $2 Million

Australia’s financial watchdog has introduced new operating conditions for cryptocurrency ATM providers, including transaction limits and enhanced compliance obligations, as authorities raise concerns over rising scam-related activity tied to the machines.

The measures, announced by the Australian Transaction Reports and Analysis Centre (AUSTRAC) on June 3, include a 5,000 AUD ($3,250) limit on both cash deposits and withdrawals, increased monitoring requirements, and mandatory scam warnings displayed on ATM kiosks. The changes follow growing reports of fraud targeting older Australians, particularly through cash-based crypto purchases.

Cash-Based Crypto Transactions Under Scrutiny

AUSTRAC’s new regulations come in response to findings from a task force investigation that reviewed data from nine major crypto ATM providers across the country. The investigation found that individuals aged over 50 represented a disproportionately high share of users, accounting for 72% of the total transaction value.

AUSTRAC CEO Brendan Thomas emphasized that the new rules are designed to reduce the criminal misuse of crypto ATMs and protect vulnerable demographics from exploitation.

“In light of the risks and harms, we consider it absolutely necessary to ensure the sector meets minimum standards and reduces criminal exploitation,” Thomas said.
“The conditions are designed to help protect individuals from scams by deterring criminals from directing victims to use a crypto ATM.”

The measures are currently limited to crypto ATM providers, but AUSTRAC has encouraged crypto exchanges operating in Australia to consider implementing similar transaction limits, especially if they accept cash-for-crypto transactions.

Crypto ATM Scam Losses May Be “Just the Tip of the Iceberg”

On the same day as AUSTRAC’s announcement, the Australian Federal Police (AFP) released a statement citing 150 unique reports of crypto ATM scams between January 2024 and January 2025. These incidents resulted in over 3.1 million AUD (approx. $2 million USD) in losses, but officials warn that many more scams likely go unreported.

AFP Commander Graeme Marshall noted that victims often don’t realize they’ve been scammed or are too embarrassed to report the incident.

“Scammers often use sophisticated tactics to elicit funds from victims. We encourage people to share their experiences to raise awareness and help protect others,” he said.

The AFP also highlighted the role of crypto ATMs in enabling anonymous and irreversible fund transfers — characteristics that scammers exploit when targeting less tech-savvy users.

Transaction Monitoring and KYC Enhancements

In addition to transaction caps, AUSTRAC’s new rules require ATM operators to implement:

• Enhanced customer due diligence (CDD)

• Real-time transaction monitoring

• Onscreen scam alerts and educational messages

The goal is to improve transparency while enabling early detection of suspicious behavior, especially involving repeat or high-value users.

The agency also reiterated its commitment to working closely with law enforcement and the private sector to continuously assess the rules’ effectiveness and make adjustments as needed.

Australia’s Rapid Rise as a Crypto ATM Hub

Though historically slow to adopt crypto ATMs, Australia has experienced rapid growth in recent years. According to Coin ATM Radar, the number of crypto ATMs in the country surged from just 67 in August 2022 to 1,819 by June 2025, making Australia the third-largest market for crypto ATMs globally.

Key providers driving this expansion include:

• Localcoin: 753 machines

• Coinflip: 700 machines

• Bitcoin Depot: 182 machines

Approximately 150,000 crypto ATM transactions are recorded annually across the country, with a total estimated cash flow of $275 million AUD. These transactions are primarily used to purchase popular cryptocurrencies like Bitcoin (BTC), Tether (USDT), and Ether (ETH).

Policy Shift Aimed at Consumer Protection and AML Compliance

The current wave of regulation follows the Financial Action Task Force’s (FATF) global push for stronger Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) standards across the crypto industry. AUSTRAC’s rules align with these international efforts by tightening oversight and minimizing regulatory blind spots, particularly for cash-heavy transactions that are harder to trace.

The task force launched in September 2024 specifically aimed to determine whether crypto ATM providers were sufficiently equipped to meet these standards. The outcome revealed inconsistencies in compliance and highlighted urgent vulnerabilities — particularly for senior users.

“It is a huge concern that people in the 60–70 year-old range are disproportionately affected,” said Thomas. “This demographic has become a prime target for scam-related activity through crypto ATMs.”

Outlook: Industry Response and Adaptation

While the measures may add operational complexity for ATM providers, industry experts view the regulation as a necessary step toward legitimizing the sector. Providers may be required to upgrade machines, enhance software, and improve staff training to comply with the new standards.

Some exchanges and ATM operators have also begun voluntarily piloting additional safeguards, such as biometric verification and real-time fraud alerts, in anticipation of broader enforcement.

Conclusion

Australia’s decision to impose new rules on crypto ATM operations represents a significant effort to tackle the growing risks of crypto-related scams, particularly among older and less technologically fluent users. By introducing cash deposit and withdrawal limits, alongside improved KYC and monitoring protocols, authorities hope to curtail the misuse of these machines and promote greater trust in the crypto sector.

As Australia solidifies its position as one of the world’s leading crypto ATM markets, the regulatory landscape is expected to continue evolving — with consumer protection and crime prevention remaining at the forefront of policy development.