BTC ATM operators are fighting against money laundering

Major ATM operators in the United States are joining forces to combat illegal activities related to BTC ATMs.

BTC ATM operators DigitalMint and Coinsource have launched the Cryptocurrency Compliance Cooperative (CCC), a new association that aims to set compliance standards for the BTC ATM industry.

A new compliance effort has been launched with the support of major blockchain analytics companies such as Chainalysis and Elliptic. The CCC now supports the participation of cryptocurrency monetary companies, regulators, financial institutions and non-state and law enforcement agencies.

Securing KYC

The association specifically focuses on BTC ATMs to ensure compliance with Know Your Customer (KYC) and Anti-Money Laundering (AML), as this type of ATM is often associated with a lack of KYC requirements.

“Unfortunately, many BTM operators feel that simply requesting a mobile phone number is sufficient care to relieve them of their mandatory KYC requirements.”

Coinsource Head of Compliance said Bo Oney.

The CCC seeks to strengthen regulatory requirements for the benefit of all BTM users and operators. This will require input from the most informed in the industry, all in order to ensure that the cash-to-crypto space is as secure as possible for consumers.

Illegal use of ATMs

Seth Sattler, Director of Compliance for DigitalMint and a major contributor to the CCC, said cases of illegal use related to the BTC ATM industry are well documented by several law enforcement agencies, including fraud, elder abuse, and drug and human trafficking.

“While a small number of BTC ATM operators use the KYC and AML protocols, others in the cash-to-crypto industry simply close their eyes and apply minimal customer protection, which in many cases allows for completely anonymous transactions.”

Sattler remarked.

BTC ATMs

Like a traditional ATM, a BTC ATM (or BTM) is a kiosk that allows users to buy or sell bitcoins and other cryptocurrencies using cash or a debit card. According to the tracking website, there are currently more than 42,000 BTMs in the United States.

Stricter regulations

In February, the New Jersey Commission of Inquiry found that 75% of BTM operators in the state allowed certain transactions without the customer having to provide any information other than a cell phone number. Last year, CEO of blockchain analyst firm CipherTrace predicted that BTC ATMs around the world would face stricter regulations, with countries including Canada and Germany already preparing to strengthen the necessary anti-money laundering regulations.

Conclusion

Global regulators have been fighting one of the main functions of cryptocurrencies for some time. That is anonymity. Their methods are uncompromising, and the world’s largest cryptobourse, Binance, had to adapt. The introduction of KYC is thus the basis for combating illegal transactions, and the crypto space must adapt to this.