What the machine actually does
A bitcoin ATM—also called a crypto kiosk or BTM—turns cash into bitcoin sent to a wallet address you choose. It is not connected to your bank, and only two-way machines also pay out cash for bitcoin. The property that matters is finality: once the bitcoin leaves the machine, neither the operator nor your bank can pull the transfer back. That irreversibility is exactly why scammers push victims toward kiosks.
The fee is hidden inside the price
Kiosks rarely show a separate fee line. Instead, the machine’s bitcoin price is marked up above the market price, so the cost is easy to miss. Regulators’ lawsuits put numbers on the markup. Iowa’s attorney general sued Bitcoin Depot and CoinFlip in February 2025, alleging cuts of roughly 23% and 21% on money sent through their machines. Washington, D.C.’s attorney general sued Athena Bitcoin in September 2025, alleging fees up to 26% per transaction without clear disclosure. These are allegations, not court findings. On a $500 purchase, a 15% markup is $75 before the buyer receives any bitcoin. Selling at a two-way machine is cheaper—published sell fees run around 5%—but the machine still pays out only after a network confirmation.
Why the QR code is the danger point
The FBI’s Internet Crime Complaint Center logged 13,460 cryptocurrency-kiosk complaints in 2025, with reported losses of $388,981,267—a 23% jump in complaints and a 58% jump in losses from 2024. The scripts repeat: a caller poses as a government agent or tech support, says your money is at risk, and walks you through withdrawing cash, visiting a kiosk, and scanning a QR code they text you. The code belongs to the scammer, and the cash is gone the moment it enters the machine. No government agency, bank, or legitimate business asks you to pay through a bitcoin ATM.
A checklist before you use one
Treat a kiosk as a last resort—for example, when you already hold bitcoin and need cash quickly. Scan only the QR code from a wallet you set up yourself, never one someone sent you. Check the bitcoin amount and exchange rate on the summary screen before confirming. Expect an identity step: small purchases may need only a phone number, while larger ones require a government ID and sometimes a selfie. Keep the receipt; selling bitcoin for cash is a taxable sale, and the receipt records what you paid and received.
If you were scammed, move quickly
Recovery is rare, but speed helps. Stop sending money and cut contact with the caller. Call the kiosk operator with the date, time, amount, location, and the wallet address you sent to, and ask whether the funds can be frozen. File a report with the FBI’s Internet Crime Complaint Center and with your state regulator, and keep every receipt. Be suspicious of anyone who contacts you offering to recover the money for an upfront fee—that follow-on recovery pitch is itself a known scam.
Adapted from Bitcoin ATM: How to Buy, Sell, and Avoid Scams.