They’re tucked away in dairies, petrol stations and vape shops from Auckland to Invercargill – and, at first glance, they look like ordinary cash machines.
Authors
- Olena Onishchenko
Senior Lecturer in Finance, University of Otago
- Murat Ungor
Senior Lecturer in Economics, University of Otago
Rather, they’re cryptocurrency ATMs. Increasingly, they have come to represent one of New Zealand’s trickiest anti-money laundering challenges.
Although New Zealand first experimented with cryptocurrency ATMs more than a decade ago, they remained a novelty until 2023, when commercial operators began rolling out permanent networks. Today, there are around 200 nationwide .
With their expansion has come concerns that the machines can be exploited by scammers and organised crime groups to convert cash into virtual assets that are difficult to trace.
Supporters, meanwhile, argue they provide a way for cash-reliant New Zealanders to access cryptocurrencies and other digital payment technologies.
Those competing concerns prompted the government to consider banning crypto ATMs altogether. Instead, it has opted for targeted regulation , arguing the risks can be managed without removing legitimate access.
Whether these machines become a legitimate part of the country’s financial system, or a growing source of consumer harm and criminal misuse, will ultimately depend on whether the right guardrails are put in place.
What are crypto ATMs?
Cryptocurrencies are digital assets that can be transferred without relying on a central bank or conventional banking system, and their use has grown rapidly around the world.
The ATMs that provide access to them, however, work much like the cash machines most people already know. Feed in cash, scan a QR code, and Bitcoin or another cryptocurrency – rather than banknotes – is sent to a digital wallet.
While “two-way” crypto ATMs exist that allow users to sell crypto for physical cash, the vast majority of machines in New Zealand are “one-way” – operating purely as cash-deposit kiosks to buy virtual assets.
In New Zealand, operators require customers to verify their identity before they can buy cryptocurrency. Once verified, the transaction can usually be completed in just a few minutes.
One potential benefit of crypto ATMs is broader access to digital financial services. An estimated 51,000 New Zealand adults were without a bank account in 2021, with barriers to banking often falling hardest on victims of family violence, homeless people, former prisoners, people with disabilities and older people.
For others, crypto ATMs can provide access to emerging digital payment systems, including stablecoins such as NZDD, which New Zealand’s Financial Markets Authority recently recognised as a payment tool .
The drawbacks, however, are substantial.
Crypto ATMs are a far more expensive option than traditional online exchanges – web platforms where users buy digital assets using linked bank accounts or cards.
While online exchanges usually charge minimal transaction fees of less than 2%, physical kiosks apply heavy layered charges. Typical ATM costs include transaction fees of 6-19%, flat fees of NZ$1-5, exchange-rate markups of 5-10%, and network fees – taking a sizeable bite out of what buyers actually end up with.
| Cash spent | Fees paid | Crypto received | |
|---|---|---|---|
| Crypto ATM (typical fee ~15%) | $10,000 | $1,500 | $8,500 |
| Online exchange (<2%) | $10,000 | $20 | $9,980 |
They also present a significant fraud risk. Most crypto ATM scams involve impostors posing as the Police, Inland Revenue Department, banks or technical support staff to persuade victims to deposit cash into a machine. Unlike credit card payments, crypto ATM transactions generally can’t be reversed once completed.
International evidence suggests the problem is growing. In 2025, the US Federal Bureau of Investigation (FBI) received more than 13,400 complaints involving cryptocurrency kiosks, with reported losses exceeding US$388 million.
Australia has experienced a similarly rapid expansion in crypto ATMs, from just 23 machines in 2019 to more than 2,000 today. Its financial intelligence agency has found heavy users are frequently linked to scam proceeds or money-mule activity.
In New Zealand, the Banking Ombudsman has confirmed that tens of thousands of dollars have already been lost through crypto ATM scams, while the Police Financial Intelligence Unit has identified the machines as an emerging regulatory challenge requiring urgent attention .
How should crypto ATMs be regulated?
While details are still to emerge, the government is setting itself new powers to regulate cash transactions involving virtual assets.
These may include transaction limits and, if evidence of harm continues to emerge, restrictions or even a future ban on cash purchases of high-risk virtual assets. Officials have also been asked to consult with the industry on what those safeguards should look like.
One obvious option is tiered transaction limits. Australia caps cash deposits at A$5,000, while some New Zealand crypto ATM operators permit transactions of up to NZ$9,500 . Small purchases could remain largely unconstrained, with larger transactions triggering additional checks.
In the US, Nebraska has taken this approach a step further. New customers begin with low daily limits and gain access to higher limits only after establishing a history of legitimate use. Because scam victims are often first-time users, this protects vulnerable customers without unnecessarily restricting regular ones.
New Zealand could also consider a mandatory 24 to 72-hour cooling-off period before an initial transaction is completed, or a confirmation call from the operator, could disrupt the urgency scammers rely on. Every transaction should also be accompanied by clear scam warnings in plain English and other languages.
Operators should also be required to refund properly reported fraudulent transactions and report suspicious activity to police in real time, creating stronger incentives to prevent scams while improving intelligence on emerging threats.
These measures should be introduced as a single package, with stronger restrictions remaining an option if problems continue.
Until then, people should bear in mind one simple safeguard of their own: treat any request to deposit cash into a crypto ATM on behalf of someone else as a potential scam.
