Britain’s Financial Conduct Authority (FCA) has ordered the closure of all Bitcoin Cashpoints in the country. ATM providers have recently received an order from Sentinel to cease operations or risk enforcement action.
Bitcoin ATMs allow cash holders to convert their cash into bitcoin or vice versa freely. Given that cash transactions are private, the proliferation of these machines has raised concerns that they may help facilitate crypto money laundering.
According to Coin ATM Radar, only 80 bitcoin ATMs are operating across the UK, compared to over 32,000 in the United States. Canada – home of the first ATMs – comes in second with about 2,300 ATMs.
Most of the machines in the UK are located in supermarkets and convenience stores, for which the FCA has also issued notices.
The authority says it has not granted any license to any ATM operator and is concerned that they do not provide adequate background checks that online exchanges are usually forced to do.
“Crypto ATMs offering crypto-asset exchange services in the UK must be registered with us and comply with UK money laundering regulations,” said the FCA.
“None of the crypto asset firms registered with us have been approved to offer crypto ATM services, meaning that any of them operating in the UK are doing so illegally, and consumers should not be using them.”
Companies found operating these machines unlawfully may be liable for fines and criminal prosecutions while being prevented from other forms of financial business.
It’s not a perfect solution for criminals, however. Though crypto transactions are natively pseudonymous, a government can arguably trace them better than dollars as long as they link a given blockchain address to someone’s identity.
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