Bitcoin ATM growth may benefit money launderers, report

Thursday 25 June 2020 14:22 CET | News

Analytics company CipherTrace has reported that as the number of Bitcoin ATMs increases, they can be used to sidestep anti-money laundering (AML) controls.

In a report, CipherTrace found Bitcoin ATMs were frequently used to send funds to ‘high-risk exchanges’ – trading platforms the company considers to be known for facilitating criminal activity and money laundering. While approximately 2% of US transactions went to high-risk exchanges in 2017, that number is now knocking at the 8% mark. Bitcoin ATMs enable people to buy and sell bitcoin as well as other cryptocurrencies directly from an exchange, using bank cards or hard cash. Users don’t need to have a digital wallet: the machines create them, providing users with printouts of the wallet addresses and private keys, according to

CipherTrace also highlighted that most US Bitcoin ATM transactions in 2019, around 88%, sent funds to offshore destinations. This coincides with new Bitcoin ATMs coming to market. Globally, there are roughly 60% more installed now than there were this time in 2019. 

ATM services in the US must sign up with the Financial Crimes Enforcement Network (FinCEN) as a money service business and are supposed to keep records of their transactions, follow know-your-customer (KYC) protocols, and report anything suspicious to the authorities. But there are still some that don’t comply. The passing of FATF guidance dubbed the ‘Travel Rule’ in 2019 means that stronger AML/KYC requirements for crypto businesses are now being implemented around the world.

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Keywords: Bitcoin ATMs, money laundering, ML, anti-money laundering, AML, CipherTrace, analytics, high-risk exchanges, cryptocurrency, bank cards, cash, digital wallet, offshore, KYC, US, FinCEN, Travel Rule
Categories: DeFi & Crypto & Web3
Countries: United States
This article is part of category

DeFi & Crypto & Web3