Australia Moves to Tighten Oversight on Crypto ATMs

The federal government is now preparing a law that could give its financial crime watchdog, AUSTRAC, sweeping authority to restrict or even ban the machines if they’re deemed a threat to financial integrity.

Cybersecurity and Home Affairs Minister Tony Burke outlined the proposal in a recent address, describing it as a flexible tool rather than a blanket prohibition. He said the government wants AUSTRAC to have the discretion to act quickly against “high-risk” technologies that enable the movement of untraceable funds.

“It’s not that every user is doing something wrong,” Burke explained, “but we’re seeing a growing concentration of criminal activity in a space that’s much harder for authorities to track.”

A Rapidly Expanding Industry

Only a few years ago, crypto ATMs were a rarity in Australia. That changed in late 2022, when private operators began aggressively installing new machines. Today, the country ranks as the world’s third-largest crypto ATM hub with over 2,000 active devices – up from fewer than 70 just two years ago.

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The industry’s leaders insist that oversight already exists. Coinflip, one of Australia’s largest operators, says every transaction requires photo identification, and machines are equipped with cameras, blockchain monitoring tools, and automated scam alerts. The company argues that crypto ATMs serve a legitimate function, offering a tangible link between the traditional cash economy and the digital one.

The Regulatory Dilemma

Despite these measures, AUSTRAC has previously flagged the machines as a weak point in the financial system. Authorities have introduced tighter reporting rules and lower transaction limits, yet the pace of growth has made it difficult to keep up.

Burke’s new legislation wouldn’t impose an automatic ban. Instead, it would let AUSTRAC decide case by case whether to regulate, limit, or remove certain machines. That flexibility, he said, is crucial as the crypto landscape continues to evolve. “We can’t predict what the next high-risk product will be,” he told reporters. “But we need the power to act before it becomes a systemic problem.”

The proposal follows similar moves overseas. New Zealand recently outlawed crypto ATMs altogether, citing a surge in money-laundering cases tied to digital currencies. Australian regulators have so far taken a softer approach, aiming to balance consumer protection with the country’s ambitions to remain competitive in financial innovation.

For now, the fate of the machines rests on AUSTRAC’s next moves – and how far Australia is willing to go to keep its crypto ecosystem both open and secure.



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