Spokane City Cracks Down: Washington Bans Crypto ATMs Amid Rising Digital Asset Crimes
Crypto's wild west just got a sheriff—at least in Spokane. Washington's second-largest city just pulled the plug on all cryptocurrency ATMs following a spike in crypto-related crimes. No more quick-fix Bitcoin buys at the corner store.
Why the ban? Blame the bad actors. Scams, money laundering, and outright theft have turned these kiosks into crime magnets. Local authorities decided it was easier to axe the machines than regulate the chaos—classic regulatory muscle-flexing with a side of techno-panic.
Finance traditionalists are grinning. 'See? We told you crypto was just a tool for criminals,' they sneer—conveniently ignoring the trillions laundered through banks annually. Meanwhile, crypto advocates call it a knee-jerk reaction that hurts unbanked citizens more than fraudsters.
One thing's clear: Spokane's move sets a precedent. Other cities eyeing similar bans now have a playbook. Whether this slows crypto adoption or just pushes it deeper underground? That’s the billion-Satoshi question.
Scammers Impersonated Law Enforcement Officers To Coerce Victims
Interestingly, Spokane City’s ban on crypto kiosks is a part of a broader trend in the US, where a rise in crypto crimes has consequently spurred the local and state governments to tighten their oversight on crypto kiosks.
Detective Tim Schwering of the Spokane Police Department has worked with several victims of crypto fraud related to these kiosks and supports the ordinance introduced by the council members.
He said that funds sent through these kiosks inadvertently ended up in places such as China, Russia or North Korea.
Regarding the modus operandi of the scammers, Schwering said that the culprits WOULD often impersonate law enforcement or tax officials and coerce their victims to convert their cash into cryptocurrency. Also, the scammers, as a standard, would claim that it was to protect their victims’ money.
Schwering added that by the time the transaction went through, it was already too late. Data shared by the FBI reveals that more than 11000 cases in connection with ATM crypto crimes were filed in the United States in 2024. Also, the majority of the victims were over the age of 60.
Total losses reported in connection with crypto ATM scams in the year 2024 are over $246 million.
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States Crack Down on ATM Crypto Crimes With New Regulations
Several states across the US have brought in their own rules and regulations to deal with the growing issue of crypto kiosk-related scams. In North Dakota, for example, House Bill 1447 is currently under consideration by the lawmakers.
The bill, if passed, will implement a $2000 daily transaction cap, a fraud warning in ATMs and make it compulsory for crypto ATM operators to deploy blockchain analytics to help detect suspicious activity.
Nebraska has already implemented its Controllable Electronic Record Fraud Prevention Act. Much of the law is similar to what North Dakota lawmakers are mulling over. The act caps transaction limits at $2000, requires ATM operators to be licensed, and caps fees at 18%.
Nebraska Gov. Jim Pillen has signed a law called the Controllable Electronic Record Fund Prevention Act to combat crypto ATM fraud, requiring operators to have a license with Nebraska's Money Transmitters Act & register with the Dept. of Banking & Finance. https://t.co/hfV1PZ4Mse
— Bank Customer Experience Summit (@bcxsummit) March 15, 2025
Additionally, the act provides for a full refund to defrauded victims if the report was filed within 90 days of the incident.
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Key Takeaways
- Authorities in Spokane City, Washington, have implemented a blanket ban on crypto kiosks
- Operators have 60 days to remove all crypto kiosks from the city
- Several states in the US are developing their own regulations to combat crypto kiosk scams
