Australia has initiated a task force to address cryptocurrency ATM providers that do not comply with the country’s anti-money laundering (AML) regulations, marking a significant regulatory effort in the digital currency sector.
In a statement released on Dec. 6, the Australian Transaction Reports and Analysis Centre (AUSTRAC) warned crypto ATM operators. It warned that there would be enforcement actions and penalties for non-compliance with AML laws in the burgeoning crypto space and taking action to smear illicit financial activity.
According to Coin ATM Radar data, Australia is currently the third-largest market for Bitcoin and cryptocurrency ATMs globally, boasting over 1,300 ATMs. However, AUSTRAC, which lists the figure at 1,200, says that only a few of the 400 registered Australian crypto exchanges use these machines. Because of this disparity, the sector has been drawn upon for heightened regulatory scrutiny.
According to AUSTRAC CEO Brendan Thomas, cryptocurrency and crypto ATMs have become attractive avenues for criminals because they are accessible and can enable “near-instant and irreversible transfers”. He said this means that the sector is a major target for police and regulatory oversight.
AUSTRAC To Crack Down On High-Risk Crypto ATMs
To counter the criminal use of cryptocurrencies, AUSTRAC has vowed to extinguish AML and high-risk cryptocurrency ATM businesses in the coming year. The initiative is part of the agency’s broader effort to bolster regulatory enforcement and protect Australia’s financial ecosystem.
Under the Australian Anti-Money Laundering Regulations, which all crypto ATM operators must follow, they must adhere to strict requirements.
These types of compliance include registering with AUSTRAC, performing Know Your Customer (KYC) checks, validating transactions, and reporting suspicious activities. In addition, operators must flag large cash transactions greater than 10,000 AUD (approximately $6,430).
The new task force will oversee the sector, ensuring that these obligations are met and minimising the crypto ATM risk they entail. Regulators have identified these machines as possible enablers of money laundering, scams, and other illicit activity and have placed compliance above their priorities.
However, its warning underlines AUSTRAC’s ongoing fears that digital currencies and exchanges can be used to facilitate financial crimes. Citing cryptocurrencies as having a ‘high’ risk channel for money laundering and terrorism financing, the agency included them in its 2024 National Risk Assessment Report. The report also warned that these risks will continue to rise over the next three years, so it is incumbent on regulators to act quickly.
Australia’s focus on crypto ATMs ramps up as the world struggles to make its crypto sector easier to police. For example, in August, German regulators conducted a high-profile sting operation, seizing 13 unlicensed crypto ATMs. Officials warned operators who did not meet regulatory requirements risked severe penalties, including imprisonment for up to five years.
