Over the past several years, we have seen cryptocurrency rise in popularity due to its convenience and potential profitability. Alongside that rise has come a wave of scams.
One of the newest scams making its way around the United States involves the use of Bitcoin ATMs.
What Is a Bitcoin ATM?
Have you ever heard of a Bitcoin ATM? Many people haven’t, but they exist all across the United States.
They work similarly to a regular ATM – you can use the machine to perform basic tasks with your account. In the case of Bitcoin ATMs, they allow you to buy and/or sell Bitcoin, often by depositing cash. (For a more detailed breakdown of how these devices work, check out Investopedia’s article here.)
According to the Federal Trade Commission, a new scam involving these machines is growing in popularity; in fact, Americans lost over $110 million in 2023 to these schemes, with older citizens being particularly vulnerable.
How Does the Scam Work?
You receive a phone call from someone who claims to work for an organization you are familiar with – it might be a financial institution, the federal government, or a commercial business. They provide you with serious-sounding information about a financial problem – it could be that you owe money on a bill, that your checking account has been hacked, or any other number of things.
The common denominator is urgency; scammers want you to act impulsively without thinking through what they are saying.
Victims of these scams travel to a Bitcoin ATM specified by the scammer. They input an account number or scan a QR code (provided by the scammer) to deposit their cash into the machine.
Victims assume that their money is going toward paying off the urgent expense the scammer is telling them about, when really, their money is being stolen.
How Can Consumers Keep Themselves Safe?
There are two easy steps you can take to keep yourself (and your money) safe from scams like this.
First, don’t answer messages from unknown sources. If you receive a call from a number you don’t recognize, let it go to voicemail first. If the voicemail directs you to contact a government agency or financial institution, instead of simply dialing the number that called you, look up the public-facing number for the entity. Using the official phone number of the entity is an easy way to ensure you’re getting in contact with the right people (instead of a scammer).
Second, never listen to anyone demanding that you transfer money or pay for expenses through a cryptocurrency ATM. That’s a clear sign that something questionable is going on.
If you think that someone has targeted you using one of these scams, report it to the FTC Consumer Response Center by calling 877-382-4357 or visiting https://reportfraud.ftc.gov.
To Wrap Things Up...
Scammers can be very creative with the measures they take to take money from innocent people. Before responding, take a deep breath and think through the situation. You have the power to keep yourself safe from fraudsters’ schemes!
