Canada is proposing to ban crypto ATMs as part of a broader crackdown on fraud and money laundering, citing growing evidence that the machines have become a key tool for fraudsters.
The measure, included in the Liberal government’s spring economic update released Tuesday, would eliminate crypto ATMs nationwide. Officials described the machines as a “primary method” to defraud victims and launder illicit funds.
“To protect Canadians by shutting down a primary method for fraudsters to defraud victims, and for criminals to place their cash proceeds from crime,” the government said, it plans to ban the machines entirely.
An automated teller machine may sound like a traditional ATM that dispenses money from your bank account, but it works very differently. Instead of withdrawing cash, these machines let users convert physical cash into cryptocurrencies like bitcoin, which can then be sent to a digital wallet anywhere in the world while bypassing traditional banking channels. This is where the risk of money laundering comes in.
The proposal follows growing concerns from law enforcement and regulators that crypto ATMs have become central to fraud schemes.
A 2023 internal analysis by Canada’s financial intelligence agency, FINTRAC, found that bitcoin ATMs are likely to remain “the primary method” fraudsters use to collect and launder funds from victims.
Canadian lawmakers are debating banning crypto as a payment method for election donations, citing concerns about the anonymity of money transfers.
Canada was home to the first bitcoin ATM, installed in a downtown Vancouver coffee shop in 2013.
