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Senate Bill Proposes Transaction Limits for Crypto ATMs to Prevent Fraud
In a move aimed at curbing the rising tide of Bitcoin ATM scams, Illinois Senator Dick Durbin has introduced the Crypto ATM Fraud Prevention Act. The bill seeks to combat the growing problem of fraud by imposing transaction limits and mandating operator verification, as well as providing refunds for victims of such schemes.
The proposed legislation comes amid an increasing number of reports revealing the alarming rise in cryptocurrency ATM scams. According to FTC data, reported losses from Bitcoin ATM scams have surged nearly tenfold since 2020, reaching a staggering $110 million in 2023 alone. It is estimated that many of these scams target older adults, with victims three times more likely to fall prey to fraudulent activities.
The Senate bill proposes setting daily transaction limits at $2,000, a move that has been met with mixed reactions from industry stakeholders. CoinFlip, a prominent Bitcoin ATM operator, stated that their machines are used daily by thousands of individuals for legitimate transactions, labeling them “critical” to the cryptocurrency sphere. The company expressed support for the legislation, emphasizing the importance of consumer protections while preserving access to digital currencies.
Not all parties have welcomed the bill with open arms, however. Critics argue that scammers may simply direct victims to multiple ATM locations in order to evade these limits. Nevertheless, consumer advocacy groups have hailed the proposed legislation as a “good first step” in addressing practices that have allowed fraud to flourish.
It is worth noting that some states have already taken action in this regard. Minnesota, California, and Vermont have all implemented daily transaction limits in an effort to protect consumers from fraudulent activities. The Senate bill would defer to state regulations if they are equally or more stringent.
The move comes as the number of cryptocurrency ATM installations continues to rise across the United States. According to Coin ATM Radar, there are now nearly 30,000 such machines operating nationwide, with a significant presence in gas stations and grocery stores. This represents a major increase from earlier years and highlights the need for enhanced consumer protections.
The proposed legislation is expected to provide a much-needed shield against fraud, allowing consumers to access legitimate digital currency services while minimizing the risk of financial loss due to scams.
Source: https://blockonomi.com/senate-bill-proposes-transaction-limits-for-crypto-atms-to-prevent-fraud/
