Bitcoin ATMs: how they work, fees and scams
A kiosk that turns cash into bitcoin in minutes, at a steep price, and the favorite payment rail of phone scammers.
A Bitcoin ATM (or crypto kiosk) is a machine that lets you buy bitcoin with cash and send it to a wallet address you scan. It's legal and convenient, but expensive: operators charge markups that state lawsuits put above 20%. Kiosks are heavily used in scams: the FBI received more than 13,400 complaints about them in 2025, with losses of about $389 million, mostly from people over 60. Many states now cap daily amounts, and Indiana, Tennessee and Minnesota have banned them.
Stop. No real bank, government agency, police force or tech-support company will ever ask you to withdraw cash and deposit it into a Bitcoin ATM, or to scan a QR code they send you. That request alone means it's a scam. Hang up and call your bank using the number on your card.
How a Bitcoin ATM works
- You choose "buy" and enter a phone number. Many machines text you a code. Larger amounts require ID, such as a scan of your driver's license and a selfie.
- You show a wallet address as a QR code. The kiosk scans it. Whoever controls that address gets the bitcoin.
- You insert cash. The screen shows the amount of bitcoin you'll receive after the operator's markup and fees.
- The operator sends bitcoin from its own supply to the address. It arrives on the blockchain within minutes to an hour, and the transaction can't be reversed.
Some machines also sell: you send bitcoin to the operator and collect cash. The machines are run by private companies, not by Bitcoin itself or by banks, though many sit in gas stations and convenience stores.
What they really cost
A kiosk's cost is mostly hidden in the exchange rate. Instead of a separate fee line, many operators sell you bitcoin at a price well above the market, plus a flat fee per transaction.
- In lawsuits filed February 26, 2025, the Iowa attorney general said Bitcoin Depot takes a 23% cut of money sent through its machines and CoinFlip 21%.
- California caps kiosk charges at the greater of $5 or 15% of the transaction (since January 1, 2025), and limits each customer to $1,000 a day.
- Maryland's financial regulator said in August 2026 that a markup on the exchange rate counts as a fee that must be disclosed, and refunded if a customer reports fraud.
Compare that with buying on a regulated online exchange, where total costs are often a few percent or less. On $500, a 20% kiosk charge costs about $100; a 1.5% exchange fee costs $7.50. Check any quote with the true cost calculator, and see ways to pay for crypto.
Bitcoin ATM scams: the numbers
Cash in, irreversible crypto out, and only a phone number required for small amounts: that combination makes kiosks ideal for scammers who coach victims on the phone.
| Source | Finding |
|---|---|
| FTC, September 2024 | Reported losses to Bitcoin ATM scams rose nearly tenfold from 2020 to over $110 million in 2023, and topped $65 million in the first half of 2024. People 60 and over were more than three times as likely as younger adults to report a loss. Median loss: $10,000. |
| FBI, 2025 data (published 2026) | More than 13,400 complaints involving crypto kiosks, up 23% from 2024, with losses of about $389 million, up 58%. People over 50 filed more than half the complaints and lost over $302 million. |
| FBI IC3, 2025 report | Adults 60 and over lost about $257 million of the $389 million, roughly two-thirds. |
The scripts repeat. A caller claims to be from your bank's fraud department, a government agency ("your Social Security number was used in a crime"), a utility, or tech support ("your computer is hacked"). They say your money is at risk and must be moved "to keep it safe." They keep you on the phone, tell you not to talk to bank staff, guide you to a kiosk and send a QR code to scan. The money goes straight to their wallet. Read more in crypto scams and check any request with the scam checker.
State laws and limits
US states have moved fast. AARP counted 30 states with laws to protect consumers at crypto kiosks by mid-2026, 13 of them passed that year. Common measures are daily limits (often lower for new customers), fee caps, required fraud warnings on screen, receipts, refunds for fraud victims who report quickly, and operator licensing. Some examples, checked on November 4, 2026:
| State | Rule |
|---|---|
| Indiana | The first statewide ban on crypto kiosks (HEA 1116), signed March 9, 2026 and effective immediately. |
| Tennessee | Ban signed April 13, 2026; in force July 1, 2026. Operating or hosting a kiosk is a misdemeanor. |
| Minnesota | Ban signed May 2026; kiosks had to go offline by August 1, 2026 and be removed by December 31, 2026. |
| California | $1,000 per customer per day (since 2024); charges capped at the greater of $5 or 15% (since 2025); kiosk operators must be licensed. |
| Maryland | Markups must be disclosed and are refundable as fees when fraud is reported (regulator advisory, August 25, 2026). |
Other countries act too: Australia's AUSTRAC capped crypto ATM cash transactions at A$5,000 in 2025 (see Australia). A federal bill to set national kiosk limits had been proposed in the US Senate but had not passed when we checked. Rules change quickly, so check your state's financial regulator for current limits.
How to use one safely, if you must
- Only send to a wallet you created and control. Never scan a QR code someone else gave you.
- Never use a kiosk because a caller, texter or new online friend told you to, however urgent it sounds.
- Read the rate on screen and compare it with the market price on a price site. A big gap is the fee.
- Keep the receipt. If you were scammed, report it immediately to the operator (some must refund fees), your state regulator, the FBI at ic3.gov and the FTC at reportfraud.ftc.gov.
- Consider whether you need a kiosk at all. A regulated exchange or a safer way to buy bitcoin is usually far cheaper.
Frequently asked questions
Are Bitcoin ATMs legal?
Yes, in most places, if the operator is registered and licensed where required. Indiana, Tennessee and Minnesota have banned them, and many states limit daily amounts and fees.
How much do Bitcoin ATMs charge?
Often far more than online exchanges. Iowa's attorney general alleged cuts of 21% to 23% at two big operators; California caps charges at the greater of $5 or 15%.
Can I get my money back from a Bitcoin ATM scam?
Usually not the crypto, because blockchain payments can't be reversed. Some states require operators to refund fees, or more, to fraud victims who report quickly. Report it at once to the operator, the police, the FBI (ic3.gov) and the FTC.
Do Bitcoin ATMs need ID?
Small purchases may need only a phone number; larger ones require ID under anti-money-laundering rules. Requirements vary by operator and state.
Why do scammers use Bitcoin ATMs?
Victims can turn cash into crypto in minutes, the payment can't be reversed, and it goes straight to the scammer's wallet address.
Where to next
Sources
- New FTC data show massive increase in losses to Bitcoin ATM scams (Federal Trade Commission, September 2024)
- FTC Data Spotlight: Bitcoin ATMs (PDF)
- 2025 Internet Crime Report (FBI IC3)
- Attorney General Bird sues crypto ATM companies (Iowa Attorney General, February 26, 2025)
- Digital Financial Assets Law (California Department of Financial Protection and Innovation)
- Markups at virtual currency kiosks (Maryland Commissioner of Financial Regulation, August 2026)
- Tennessee bans crypto ATMs statewide, joining Indiana (The Block, April 2026)
- A ban on crypto kiosks in Minnesota begins Aug. 1 (MPR News, July 2026)
- Crypto kiosk legislative update (AARP, May 2026, PDF)
Written for beginners and checked against the sources listed. Last reviewed November 4, 2026. This page is educational and is not financial, tax or legal advice. How we write and check pages.