AUSTRAC says regulation has lagged behind the explosion in the number of cryptocurrency ATMs, with criminals exploiting the use of the machines.

These ATMs allow users to purchase or sell cryptocurrency using cash and can be misused by criminals to coerce victims into using the machines to send them cryptocurrency.

Over the past six years, the number of active crypto ATMs in Australia has increased more than 15-fold, from 23 to more than 1600 today.

But so has the level of scams linked to the technology.

Over the 12 months leading up to this January, authorities examined 150 scam cases related to crypto ATMs, with estimated losses totaling $3,107,600, though this figure is thought to merely scratch the surface.

The three types of fraud involved were investment swindles, extortion emails romance scams.

The majority of victims were women.

AUSTRAC projects about $275 million is being moved through crypto ATMs every year and intelligence suggests many transactions are scam-related.

Australian Federal Police Commander Graeme Marshall says most of the people using the machines are aged over 50.

“Unfortunately, the reality is that once crypto is sent to a scammer, it’s difficult to trace and almost impossible to get back,” he said.

Crypto ATMs will now be subject to industry-wide controls, but users are being urged to be wary of warning signs for potential scammers.

“These can include being asked to deposit cash into a crypto ATM for any reason, offers or requests with an extreme sense of urgency, or crypto investments promising ‘guaranteed’ high returns with no risk,” Marshall said.

“If something sounds too good to be true, it probably is.”