According to a recent legislative probe, some cryptocurrency ATMs had fees as high as 33% and some had restrictions of up to $50,000.


In response to the rise in frauds, California lawmakers have introduced a new measure titled

Digital Financial Asset Transaction Kiosks" that would ban daily withdrawals from cryptocurrency ATMs at $1,000. 

The proposal would also cap operators' costs at $5 or 15% (whichever is higher) beginning in 2025. If passed, the legislation would take effect on January 1, 2024.

Legislative lawmakers discovered markups of up to 33% on some crypto assets compared to their prices on cryptocurrency exchanges while visiting a crypto ATM in Sacramento, which prompted the introduction of the measure. A legislative investigation found that the typical fee for a crypto ATM is between 12% and 25%.

Officials from the government discovered ATMs with withdrawal limits as high as $50,000, 

Which prompted them to enact regulations to prevent such exorbitant premiums and limits. There are almost 3,200 Bitcoin BTC available.

The co-author of the measure, Democratic State Senator Monique Limón, stated that the goal of the new bill is to make sure that those who have been defrauded in our communities.

Don't continue to watch our state step aside" when serious problems are there.

By July 2025, another clause of the measure would mandate that companies dealing in digital financial assets apply for licences from the California Department of Financial Protection and Innovation.

Due to the nature of the transactions (real cash), which make crypto ATMs a popular means for consumers to swap cash for their preferred cryptocurrency, they have also developed into a hotbed for frauds and exploitation.

This prevents the chance of leaving a trail, unlike bank and wire transfers.

Some locals have recently fallen victim to these scams, in which the con artist convinces the victim to visit nearby cryptocurrency ATMs and deposit cash for the cryptocurrency of their choice.

The LA Times noted that the victims of the ATM scam have applauded the decision and claimed the low transaction limit will allow them time to determine if they are being misled.

However, cryptocurrency ATM companies said that the new law would hurt small company owners who had to pay rent for their ATMs.

The operators pointed out that the bill pursues a punitive strategy centred on a particular technology rather than addressing the fundamental cause of the scam. The industry would be shaken, they said, and consumers would suffer.


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