New Zealand Bans Crypto ATMs to Combat Money Laundering

New Zealand has implemented a ban on cryptocurrency ATMs as part of a broader initiative to combat financial crime. This decision, announced on July 9, is aimed at curbing the misuse of digital currencies for illicit activities such as money laundering and fraud. The ban is part of a comprehensive set of anti-money laundering reforms that also include a cap on international cash transfers to $5,000.

According to Associate Justice Minister Nicole McKee, the reforms are designed to "target criminals" by restricting their ability to convert large volumes of illicit cash into cryptocurrencies through virtual currency kiosks. The new measures will enhance enforcement powers for police and regulators, and expand the capabilities of the Financial Intelligence Unit in tracking financial activity linked to persons of interest.

McKee emphasized that the overhaul aims to make New Zealand one of the easiest places in the world to do legitimate business while making it one of the hardest for criminals to hide. The reforms are intended to cut unnecessary red tape for low-risk entities, allowing regulators to focus their efforts on serious financial threats.

By capping international cash transfers to $5,000, regulators hope to limit how criminal groups move illicit funds offshore while preserving legitimate remittance options through electronic bank channels. This measure is part of a broader effort to strengthen the anti-money laundering and counter-financing of terrorism (AML/CFT) framework, which is central to reducing the misuse of cryptocurrencies and cross-border cash flows.

Crypto ATMs, which enable cash purchases of digital currencies, have been identified as a key tool for money laundering. A 2024 report from New Zealand’s Ministerial Advisory Group on Transnational, Serious and Organised Crime found that criminals used these kiosks to send funds abroad "within minutes" to finance drug imports and scams.

Concern over the misuse of crypto kiosks has been growing among regulators worldwide. An FBI report linked crypto ATMs to $246 million in fraud-related losses across the U.S. in 2024, with over 11,000 complaints. Last month, Spokane, Washington, became the first city in the state to enact a full ban, giving operators 60 days to remove over 40 kiosks following a rise in fraud complaints. Officials said scammers frequently impersonated police or tax authorities to pressure victims into using the machines to transfer funds.

Similarly, Nebraska passed the Controllable Electronic Record Fraud Prevention Act earlier this year, mandating state licensing for ATM operators, capping fees at 18%, and setting daily limits of $2,000 for new users. It also introduced mandates for kiosk operators to refund requirements for defrauded customers who report scams within 90 days.

Australia’s financial intelligence agency, AUSTRAC, also moved to tighten oversight in June 2025, imposing a 5,000 Australian dollar cash cap per transaction, mandatory scam warnings, and enhanced customer due diligence obligations.

New Zealand's decision to ban crypto ATMs and limit international cash transfers is part of a global trend of governments taking steps to regulate the use of cryptocurrencies. As digital currencies become more mainstream, governments are increasingly recognizing the need to balance the benefits of innovation with the risks of financial crime. These measures are part of a broader effort to strengthen New Zealand's financial regulatory framework and protect its citizens from the risks associated with financial crime.