Australian Home Secretary announces broad powers to regulate crypto ATMs

Australian Home Affairs Minister Tony Burke announced new rules Wednesday to crack down on virtual currency ATMs, saying the machines are “high-risk products” linked to money laundering, fraud and child exploitation.

This announcement was part of a broader plan wipe out new forces Combating money laundering, terrorist financing and criminal risks.

“Six years ago there were 23 animals in Australia. Three years ago we had 200 animals and now we have 2,000 animals. We’re growing rapidly,” Mr Burke said in a speech at the National Press Club in Canberra. ABC News.

The Home Secretary said that buying cryptocurrencies with cash makes them difficult to trace and that AUSTRAC has linked crypto ATMs to money laundering, fraud, fraud, illegal drugs and child exploitation.

“When we looked at the top users, the top users who put the most money into cryptocurrency ATMs, 85% of the funds passing through the top users were involved in fraud and money mules,” he said.

The announcement marks the culmination of growing regulatory pressure on an industry that authorities say is growing unchecked while facilitating financial crime.

Mr Burke said a bill was being drafted that would give AUSTRAC the power to restrict or ban “high-risk products” including virtual currency ATMs, and ministers expected to introduce the bill to parliament in the coming months.

The minister declined to say whether AUSTRAC would ban the machines completely, saying such a declaration could lead to a “legal challenge”.

“The ability for AUSTRAC to request it will be given by the legislation I will introduce,” Mr Burke added.

Viewed from a risk perspective

James Volpe, founding director of Melbourne-based Web3 education company uCubed, told Decrypt, “Compared to other established channels such as banks, casinos, and money transfer services, I don’t think crypto ATMs pose a significant risk (especially since most crypto ATMs already require some level of KYC verification).”

He said ATMs needed attention despite not being “one of the most prominent sources of financial crime risk”, adding how AUSTRAC appeared to be focused on “targeting criminal abuse rather than stifling innovation”.

Regulatory crackdown began to gain momentum after AUSTRAC deployed virtual currency ATM operators in March “By notice” After a task force formed in late 2023 uncovered “concerning trends and signs of suspicious activity” related to the machines.

By June, the agency had refused to renew the registration of virtual currency ATM operator Harro’s Empires. Imposed trading limits In addition to enhanced customer due diligence requirements across sectors, there will be a cost of $5,000.

Mr Volpe said there was room for “smarter cooperation” between AUSTRAC, law enforcement and ATM providers.

He suggested that automated systems could “monitor transaction patterns and flag only high-risk or suspicious activity for further investigation,” which would allow for “targeted enforcement while preserving users’ privacy rights.”