Spokane Bans Crypto ATMs to Combat Scams Targeting Residents

Spokane, the second-largest city in the US state of Washington, has implemented a ban on cryptocurrency ATMs to combat the rising number of scams targeting its residents. The Spokane City Council unanimously voted to prohibit these machines, making it the first city in Washington to do so. The measure was proposed by Council member Paul Dillon, who emphasized that crypto ATMs have become a favored tool for scammers aiming to defraud unsuspecting victims. The ban is intended to protect vulnerable residents from scams involving virtual currency kiosks.

Dillon noted that the ban will not only prevent the installation of new crypto ATMs but also require the removal of existing kiosks. He observed that many of these machines are located in low-income neighborhoods, convenience stores, and grocery stores. The ordinance highlights a significant increase in scams related to cryptocurrency kiosks, with victims losing thousands of dollars. The city aims to provide a tool to protect consumers from individuals who use virtual currency to defraud others.

Crypto ATM operators have been given 60 days to remove their machines citywide or face civil infractions and potential revocation of their business licenses. The Spokane City Council will monitor the impact of the ordinance and report on whether it reduces the frequency of reported crimes involving crypto kiosks. Police detective Tim Schwering reported that money fed into these kiosks often ends up in countries like China, North Korea, and Russia. Scammers impersonate law enforcement or tax officials, convincing victims to buy crypto to protect their money or avoid jail time. By the time the money is converted into cryptocurrency, it is already too late for victims to recover their losses.

The ban on crypto ATMs in Spokane is a proactive measure to address the growing number of scams in the region. City council members, including Paul Dillon, have emphasized the positive impact this ban will have on public safety. By removing these machines, the city aims to mitigate the risks of fraud and protect its residents from financial exploitation. The ordinance reflects a broader trend of regulatory scrutiny on cryptocurrency activities, as authorities seek to balance innovation with consumer protection.

The decision to ban crypto ATMs in Spokane is part of a broader effort to address the challenges posed by the rapidly evolving cryptocurrency landscape. While cryptocurrencies offer new opportunities for financial transactions, they also present significant risks, particularly for those who are less familiar with the technology. The ban aims to safeguard vulnerable residents by eliminating a common vector for fraudulent activities. This move is likely to be closely watched by other municipalities grappling with similar issues, as they consider their own approaches to regulating cryptocurrency transactions.