Bitcoin Depot, the largest Bitcoin ATM operator in the United States, is rolling out mandatory ID verification for every transaction at its crypto kiosks. The move comes as regulators and lawmakers increase pressure on crypto ATM companies to prevent scams and money laundering.
The company confirmed that the new requirement began rolling out across its U.S. network earlier in February. The goal is to strengthen security, detect suspicious activity in real time, and reduce misuse such as identity theft, account takeovers, and account sharing.
According to CEO Scott Buchanan, continuous identity verification allows the company to flag unusual activity based on customer behavior, transaction size, or location before approving a transaction. He said the additional verification step is designed to protect customers and maintain the integrity of the company’s services.
Bitcoin Depot had already introduced ID requirements in October, but at that time, the policy only applied to new users. The updated rule now extends identity verification to every transaction, regardless of whether the customer is new or returning.
The United States remains the world’s largest market for Bitcoin ATMs. Data from Coin ATM Radar shows there are more than 31,000 machines operating nationwide, accounting for roughly 78% of the global total. Bitcoin Depot leads the U.S. market with over 9,000 kiosks installed across the country.
State Lawsuits and Growing Scrutiny of Crypto ATMs
Crypto ATMs have long been criticized for being exploited by scammers. Fraudsters often direct victims to deposit funds into Bitcoin ATMs because transactions are irreversible and the machines are widely accessible. As a result, regulators have stepped up enforcement actions against operators.
The American Association of Retired Persons reported in February that 17 U.S. states have passed laws requiring crypto ATM operators to implement stronger consumer protections. These measures include daily transaction limits, mandatory fraud warning notices, and stricter licensing requirements.
Bitcoin Depot has also faced legal challenges at the state level. Earlier this month, Andrea Campbell, Attorney General of Massachusetts, filed a lawsuit against the company. The complaint alleges that Bitcoin Depot failed to put adequate safeguards in place to prevent scams. Campbell is seeking a court order that would block the company from processing large transactions without additional user protections.
In January, Aaron Frey, Attorney General of Maine, announced a $1.9 million settlement with Bitcoin Depot. The agreement aims to reimburse individuals who lost money to scams involving the company’s ATMs.
Meanwhile, in Iowa, Attorney General Brenna Bird filed a lawsuit last year against Bitcoin Depot and its competitor Coinflip. The lawsuit alleges both companies failed to implement sufficient anti-fraud protections.
