In its statement dated December 6, the Australian Transaction Reports and Analysis Center (AUSTRAC) warned crypto ATM operators and stated that serious sanctions and penalties will be imposed if the laws are not followed. The move increases regulatory pressure on the rapidly growing crypto ATM industry in the country.

According to Coin ATM Radar data, Australia ranks third after the United States and Canada with more than 1,300 Bitcoin and crypto ATMs worldwide.

However, AUSTRAC states that there are approximately 1,200 crypto ATMs in the country, and only a small number of them are operated by the 400 registered digital currency exchanges. This causes regulators to monitor this industry carefully.

AUSTRAC CEO Brendan Thomas stated that cryptocurrencies and ATMs have become an attractive tool for criminals. The easy accessibility of ATMs and the possibility of making “instant and irreversible transfers” make this technology ideal for crimes such as money laundering and fraud.

Thomas said that in order to minimize these risks, they aim to eliminate incompatible and high-risk operations throughout 2024.

Crypto ATM operators in Australia must comply with the following obligations in accordance with AML laws:

• Registering with AUSTRAC,
• Implementing Know Your Customer (KYC) protocols,
• Monitoring transactions,
• Reporting large cash transactions over AUD 10,000 (approximately $6,430) and suspicious activity.

The task force will strictly monitor the industry to ensure compliance with these regulations and prevent crypto ATMs from enabling money laundering, fraud and other illegal activities.

AUSTRAC’s move is in line with national reports that digital currencies and crypto exchanges pose risks of money laundering and financing terrorism.

The 2024 National Risk Assessment Report identified cryptocurrencies as a “high” risk channel and predicted that these risks would increase over the next three years.

Besides Australia, other countries are taking similar measures. In August 2024, Germany seized 13 illegally operating crypto ATMs and warned that unlicensed operators would face heavy sanctions.

In the United Kingdom, the Financial Conduct Authority (FCA) announced that there is no legal crypto ATM operating in the country.

AUSTRAC’s initiative is seen as an important step to reduce illegal activities in the crypto sector and increase trust in the sector.

However, it is a matter of curiosity how the tightening of regulations will affect the growth rate and innovation potential of the sector. With this move, Australia aims to play a leading role in crypto regulations around the world.