Missouri Sues CoinFlip, Seeks $1.83M Penalty and Ban

Missouri Attorney General Catherine Hanaway on Wednesday sued Bitcoin ATM operator CoinFlip, seeking $1.83 million in civil penalties and an order barring the company from operating in the state. The complaint alleges CoinFlip knowingly facilitated scams that targeted elderly consumers and profited from fraudulent transactions through opaque and potentially predatory fees.

The attorney general’s office said state law enforcement analysts identified roughly 350 cases involving Bitcoin ATMs in Missouri over the past two years. The office said CoinFlip operates about 140 kiosks in the state and that Missouri hosts 429 Bitcoin ATMs statewide based on data cited by the office.

The complaint alleges CoinFlip failed to prevent criminals from using its kiosks to convert stolen cash into cryptocurrency and that the company benefitted from fees tied to those transactions.

Hanaway said she would “use every tool to flush out the cowardly scammers hiding behind screens and hold them accountable,” and compared Bitcoin ATMs to “getaway cars for fraud.”

CoinFlip called the suit “meritless,” arguing it maintains consumer safeguards and has pushed for consumer protection laws for cryptocurrency kiosks. The company urged authorities to pursue the individuals committing fraud and said it is prepared to defend itself in court.

The lawsuit comes amid increasing legal and financial pressure on Bitcoin ATM operators. CoinFlip faces a separate major lawsuit in Iowa. This week Bitcoin Depot, North America’s largest Bitcoin ATM operator, filed for Chapter 11 and shut down more than 9,000 machines; its chief executive blamed a tougher regulatory environment and rising litigation costs.

Authorities say many kiosk schemes use impersonation tactics — posing as government officials, tech support or law enforcement — to convince victims to send cryptocurrency or withdraw cash for transfer. The FBI reported Americans lost $389 million to crypto-related scams last year. State officials pointed to a Massachusetts scheme that used a threat of arrest over “missed jury duty.”

The case will proceed in Missouri courts, where Hanaway seeks both the financial penalties and an operational ban. CoinFlip has said it will defend its practices as the litigation continues.