Germany’s Federal Financial Supervisory Authority (BaFin) has intensified its efforts to regulate the cryptocurrency sector, launching a sweeping crackdown on unregistered crypto ATMs across the country. On August 20, BaFin announced that it had seized 13 unauthorized automated cash kiosks from 35 locations in collaboration with the Federal Criminal Police Office, local law enforcement agencies, and Germany’s Bundesbank.

The regulator revealed that the operators of these ATMs had installed the machines without obtaining the necessary registration under Section 32 of the German Banking Act. BaFin asserted that the exchange of euros for cryptocurrencies—or vice versa—via these machines constituted a breach of the Banking Act. Furthermore, German authorities expressed concerns that crypto ATMs could become hubs for illicit activities if operators do not enforce stringent Know Your Customer (KYC) protocols, particularly for transactions exceeding €10,000.

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Global Landscape of Crypto ATMs in Flux

While the installation of Bitcoin ATMs worldwide had been approaching record levels in 2024, this upward trajectory faced a significant setback in July. A global decrease of 440 crypto ATMs was recorded during the month, followed by an additional reduction of 173 machines by August 1. Despite this decline, the latest data from Coin ATM Radar indicates a rebound, with 266 new ATMs installed globally since the beginning of August.

The recent downturn in Bitcoin ATM installations can be partially attributed to enforcement actions in the United States. Law enforcement agencies have been actively targeting unlicensed Bitcoin ATM operators, leading to several shutdowns. Among the notable cases is Bitcoin of America, which faced regulatory action in 2023 when the Connecticut Department of Banking charged the company with operating money transmitter services without the required license. This action was prompted by numerous customer complaints, with individuals alleging that they were collectively defrauded out of tens of thousands of dollars.

As part of a consent order, Bitcoin of America agreed to cease operations in Connecticut and pay $86,000 in restitution to the affected customers. This case underscores the growing scrutiny that crypto ATM operators face as regulators around the world seek to tighten controls over the rapidly expanding cryptocurrency sector.