Canada proposes nationwide ban on crypto ATMs

Canada’s Department of Finance proposed a nationwide ban on unmanned Bitcoin and other cryptocurrency ATMs in an economic update released Wednesday. The plan would allow cash-to-crypto purchases only at brick-and-mortar money services businesses (MSBs) that keep a physical office and have employees on site during business hours.

The proposal would require self-service kiosks commonly found at gas stations and convenience stores to be shut down across the country. The department described cash-exchange machines as ‘a primary method’ used by scammers to pressure victims into converting cash to cryptocurrency and sending funds directly to criminals’ wallets, a tactic that targets seniors and other vulnerable people.

The federal plan would override provincial rules that currently regulate some operators. Provinces such as Quebec already require crypto ATM operators to register as MSBs and comply with anti-money-laundering obligations. A federal ban would order a nationwide closure of unmanned kiosks regardless of local licensing.

The government pointed to enforcement by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), which in March revoked licences for 84 MSBs, about 70 of which were involved in virtual currency transfers, including firms linked to ATM operations.

Canada hosts nearly 4,000 crypto ATMs, with more than a quarter concentrated around Montreal. By comparison, the United States has more than 30,000 machines. Officials cited schemes that involve impersonation of government officials, law enforcement or tech support to coerce victims into depositing cash into kiosks.

Similar measures have appeared elsewhere. Indiana has outlawed crypto ATMs, and Tennessee passed legislation that makes ownership or operation of the devices a criminal offense; Tennessee’s governor signed the bill on April 13 and operators must disable kiosks by July 1. U.S. authorities reported Americans over age 60 lost $257 million to scams involving crypto ATMs last year, a 58 percent increase from the previous year. New Zealand enacted a ban on crypto ATMs last year.

If adopted, unmanned kiosks would have to cease operations nationwide, effectively overriding local licensing frameworks. The Department of Finance did not set a specific implementation timeline; the proposal must go through the federal rule-making or legislative process before it can take effect.