Australia's national financial intelligence agency could be given the ability to limit or ban crypto ATMs under a brand new draft law within the works by the country's Cybersecurity and Home Affairs Minister Tony Burke.
Burke said during a speech on the National Press Club on Thursday that the bill will give the Australian Transaction Reports and Analysis Center (AUSTRAC) the flexibility to limit or ban “high-risk products,” which include crypto ATMs.
While regular ATMs are also used for fraud and illegal activities, Burke said that within the case of crypto ATMs, authorities have had limited success in monitoring and tracking illegal funds and fear they pose a money laundering risk.
“I'm not suggesting for a minute that anyone getting in and using a crypto ATM is an issue, but relative to that, what's happening is a big problem in an area that's much harder for us to trace.”Cybersecurity and Home Affairs Minister Tony Burke is drafting laws that will allow AUSTRAC to ban or restrict crypto ATMs. Source: YouTube
Australia was initially a slow marketplace for crypto ATMs, but adoption increased exponentially towards the tip of 2022 after private firms began entering the market, and the country is now the third largest crypto ATM hub with 2,008, up from 67 in August 2022.
The crypto ATM provider argues that there are already rules in place
More than half of Australia's crypto ATMs are operated by three providers: Localcoin, with 868 in its inventory; Coinflip with 682 ATMs; and Bitcoin Depot with 267.
In a press release to Cointelegraph, a Coinflip spokesperson said that crypto ATMs are already subject to strict rules and KYC (Know Your Customer) verification, which incorporates presenting a legitimate government-issued ID before making a transaction.
AUSTRAC has previously led several crackdowns on crypto ATMs and introduced latest operating rules and transaction limits in June.
Machines also produce other safety measures
Coinflip also said the machines feature cameras, pre-transaction monitoring using blockchain evaluation, and real-time fraud alerts to curb malicious actors.
“Crypto ATMs are a crucial bridge between the physical and digital worlds, bringing cryptocurrencies from the cloud to the physical world with a well-known experience,” the spokesperson said.
“As traditional ATMs proceed to say no across Australia, interest in cryptocurrencies increases and banks maintain a hawkish stance on digital assets, the environment is primed for CATMs to thrive.”
New powers can be optional
Burke said the federal government wouldn’t push for an outright ban on the machines or recommend a plan of action for AUSTRAC as this may lead to a “legal challenge”.
However, he intends to “give them the authority to limit or ban these devices” in order that the agency has the tools to watch latest technologies in a fashion it determines.
“I'm unsure what is going to occur next and there can be times where AUSTRAC decides to do something that doesn't quite fit that definition but is analogous to: do they wish to ban or do they need to control?” Burke said.
“How are they going to take care of this? Are there ways to really prevent the issue? That's why they're going to have this power over high-risk products,” he added.
