The Massachusetts Attorney General’s lawsuit is the latest in a series of state legal actions against one of the world’s largest crypto ATM operators.
By Ben Dooley, CNN | Edited by Kehinde Adegoke, TheDiggerNews
“We’re alleging that instead of handling consumers’ money in good faith,Bitcoin Depot used misleading sales tactics to overcharge its customers and knowingly facilitated crypto scams that resulted in more than $10 million in losses for Massachusetts consumers,” Massachusetts Attorney General Andrea Joy Campbell said.
The suit, filed February 3, follows a series of similar actions across the country, as concerns mount that sophisticated fraudsters are exploiting these machines to target victims — especially the elderly — for hundreds of millions of dollars annually.
The industry says these machines let customers exchange cash for cryptocurrency at automated kiosks that work like bank ATMs, allowing them to buy electronic currencies such as Bitcoin without using regular online crypto exchanges.
But law enforcement officers across the country have seen a surge in fraud involving these machines, with scammers using them to quickly move victims’ funds beyond the reach of authorities.
The Numbers Tell the Story
In 2024, the FBI received nearly 11,000 fraud complaints involving crypto ATMs — a 99% increase from 2023 — representing about $247 million in alleged losses. From January to November 2025, losses from similar fraud grew to around $333 million.
In response to this widespread abuse, legislators at both state and local levels have imposed tighter safeguards or outright bans on the machines, driving lawsuits from attorneys general in Iowa and Washington, D.C.
Bitcoin Depot’s Damning Internal Records
The complaint says over half the money that passed through Bitcoin Depot kiosks in Massachusetts from August 2023 to January 2025 was linked to scams. These allegations echo those in a 2025 Iowa lawsuit, which found that over 50% of the company’s transactions in the state between October 2021 and July 2024 appeared to involve scams.
More damning still: Bitcoin Depot knew its machines were being used for scams. The complaint alleges that in 2021, the company’s own due diligence team found that 90% of customers they spoke with were scam victims. One employee told a top executive that the kiosks were facilitating money laundering at “extreme volume.”
Bitcoin Depot later made its compliance measures “less effective,” according to the complaint — a change that allegedly made it easier for fraud to occur. The company’s own records showed that from March to September 2023, between 13% and 16% of money passing through its machines was scam-related.
Prosecutors also say the company approved transactions that should have raised red flags, including customers using multiple kiosks in a single day. The complaint notes that some customers used obvious fake names such as “John Wick” and “the Chosen One.”
The company also allowed customers to send money to foreign crypto exchanges that do not permit U.S. users to hold accounts — pointing to an international money-laundering pipeline moving funds entirely beyond the reach of American authorities.
The Circle K Connection
A 2025 investigation by the International Consortium of Investigative Journalists (ICIJ) and CNN revealed how Bitcoin Depot machines installed in hundreds of Circle K convenience stores facilitated at least $1.5 million in scam transactions. Circle K received millions in rental fees from the partnership, while Bitcoin Depot kept between 15% and 50% of each deposit.
The investigation found that Circle K management knew the machines were being used to defraud both customers and their own employees — and chose to renew its contract with Bitcoin Depot anyway.
Bitcoin Depot Responds
In a statement, Bitcoin Depot said it strongly disagrees with claims that it facilitates scams or misleads users, adding that it has built its business around compliance and consumer protection, works with law enforcement, and has implemented multiple safeguards to protect customers.
On the day the Massachusetts suit was announced, the company said it would require customers to verify their identity for every transaction.
Adding to the regulatory pressure, Missouri’s attorney general opened an investigation in December, sending Bitcoin Depot and four competitors requests for evidence of suspected consumer protection violations tied to new crypto ATM scams targeting Missourians.
