Germany’s financial regulatory authority BaFin is on a mission to crack down on illegally installed cryptocurrency automated teller machines (ATMs) in the country. The watchdog has seized €25 million ($28 million) in cash from these ATMs, according to its official statement.

BaFin stated that it raided 35 locations nationwide and seized 13 ATM machines that were illegally installed and not registered with due process.

BaFin Says There Is A High Risk Of Money Laundering Using These ATMs

The watchdog also pointed out that the exchange of fiat currency and cryptocurrency using the ATMs is in violation of the country’s existing Banking Act.

Also, the regulator stated that the exchange could open the door for money laundering using cryptocurrency as a safe means to avoid being caught. Germany has 176 installed Bitcoin ATMs in several locations across the country.

However, Düsseldorf houses most of the machines, while Berlin also has a good number of them. Stuttgart comes third when it comes to the cities with the highest number of installed Bitcoin ATMs in the country.

The global demand for Bitcoin ATMs surged in 2021 when the crypto frenzy was still very hot. When the crypto industry started witnessing a slump, many of them were closed. However, the recent resurgence of ATMs is an indication that interest in cryptocurrencies has peaked once again. This month alone, 266 Bitcoin ATMs have been installed and more will be installed as the industry continues to boom.

The crypto ATMs offer a more convenient way for people to buy and sell cryptocurrencies in exchange for cash. Users can use these machines to transfer Bitcoins to wallets held by them. However, ATMs usually have much higher transaction fees compared to online exchange platforms.

UK’s Regulator FCA Clamps Down on Illegal ATMs

Chief Operating Officer of Bitcoin Depot, Scott Buchanan, stated that in 2023 the global crypto ATM market reached $182.1 million. It is expected to continue growing at an annual compound rate of 63.4% from 2024 to 2030.

This year alone, more than 2,500 Bitcoin ATMs have been installed across the world. This indicates strong growth for the crypto market after it recovered from the heavy dip in 2022.

BaFin stated that the unanimous nature of cryptocurrencies makes them a hotbed for fraudsters masquerading as genuine business owners. It becomes much of a concern if the ATM operators do not maintain proper know-your-customer (KYC) standards for transactions above €10,000.

Apart from BaFin, the UK’s Financial Conduct Authority (FCA) is also cracking down on illegal Bitcoin ATMs in the United Kingdom. Last year, the regulator shut down 26 Bitcoin ATMs that were operating illegally.