Coinme Fined $300K in California’s First Crypto ATM Enforcement Case
Summary:
Crypto ATM operator Coinme has agreed to pay a $300,000 fine after violating California’s Digital Financial Assets Law, marking the first enforcement action under the state’s new regulatory framework for digital assets.
Regulatory Breach and Restitution
Seattle-based Coinme was penalized for exceeding California’s daily transaction limit of $1,000 per customer via its crypto ATMs and failing to provide mandatory disclosures on transaction receipts. The kiosks are located in grocery stores and convenience shops across the state.
As part of the settlement, Coinme will also pay $51,700 in restitution to an elderly customer who was reportedly defrauded using one of the machines.
The California Department of Financial Protection and Innovation (DFPI) stated that the case sets a precedent for enforcing digital asset compliance in the state.
“This action sends a strong message that California means business when it comes to protecting consumers from crypto-related fraud,” said DFPI Commissioner KC Mohseni.
Background on California’s Digital Asset Law
The Digital Financial Assets Law, introduced in 2023, was designed to curb consumer risk at crypto kiosks, following a rising trend of scams where fraudsters trick victims into transferring funds using crypto ATMs.
Crypto ATM Fraud Surging
The FBI reported nearly 11,000 complaints related to crypto ATM scams in 2024, resulting in $246 million in losses, a 31% increase from 2023. Notably, two-thirds of the victims were aged 60 or older.
To combat this trend:
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Spokane, Washington, recently banned crypto ATMs to reduce fraud and money laundering, citing ties to foreign entities like China, North Korea, and Russia.
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Texas authorities dismantled a crypto kiosk after a family lost $25,000 in a scam.
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Australian police launched a probe involving over 90 citizens in a crackdown on criminal use of crypto ATMs.
Investor Implications
The Coinme case highlights increasing regulatory scrutiny on crypto infrastructure, particularly retail-facing touchpoints like ATMs. Investors should monitor how state and federal regulators begin enforcing consumer protection and AML compliance measures across the digital asset sector, especially as crypto adoption continues to rise among older and less tech-savvy demographics.
Coinme has not issued an official statement on the matter at time of writing.
