Coral Springs commissioners approved on first reading an ordinance that would prohibit convertible virtual currency kiosks, also known as crypto ATMs, within city limits. The vote came at the Oct. 7 meeting. Code compliance, not the police department, would enforce the rule.
Detective Chad Whittington said 14 of the machines were operating in the city as of last week, down from 19 earlier this year. They are mostly located in gas stations, convenience stores, smoke shops and the mall. Private companies such as Bitcoin Depot, CoinHub, Athena Bitcoin and CoinFlip own and run them, and pay the host businesses for space.
Police have seen a rise in fraud cases tied to the kiosks. Scammers typically persuade victims, often older people who are unfamiliar with cryptocurrency, to feed cash into a machine. The money is converted to crypto minus a fee and sent to a digital wallet the suspect controls, using a QR code the suspect provides. Once the funds move, Whittington said, they are nearly impossible to trace or recover.
Whittington cited investigations by the attorneys general in Iowa and Washington, D.C., which found that 93% to 95% of transactions at crypto ATMs in those jurisdictions resulted from fraud. He said the city hopes other municipalities will follow its lead.
