Huyett: Crypto ATM Panic Won't Protect The Elderly

By Ian Huyett, NH Journal

Thanks to the leadership of Rep. Keith Ammon, New Hampshire has long been a leader in pro-blockchain policy innovation. Yet this session, members of the AARP and some police chiefs have joined forces in a campaign to de facto ban Bitcoin ATMs — also called crypto “kiosks” — in the Granite State.

Crypto kiosks are physical machines, usually found in gas stations or convenience stores, that let you buy cryptocurrency with cash or a debit card and exchange your crypto for cash. Crypto enthusiasts appreciate Bitcoin ATMs because, unlike crypto platforms that send and receive dollars from your bank account, kiosks allow you to exchange cryptocurrency directly for paper money.

First created in 2013, Bitcoin ATMs have a long history in New Hampshire. While the precise origin of the technology is ambiguous, Lamassu — one of the first two crypto kiosk companies — was founded by Granite Staters. Murphy’s Taproom in Manchester hosted what was probably New Hampshire’s first Bitcoin ATM in 2015.

Yet police chiefs and other opponents of kiosks associate them with only one thing: a notorious wave of phone-based scams targeting elderly Americans. Since these critics have never used a kiosk themselves — and may be ignorant of the growing, mainstream blockchain economy — they assume the ATMs have no significant purpose except to facilitate “kiosk scams.”

Kiosk scams are almost always the same. A scammer — usually based in India, Southeast Asia, or West Africa — calls the victim, claims to be a government agent, and demands that the victim urgently send money. Speaking in a heavy accent, the scammer tells the victim he will go to prison if he does not pay immediately.

The scammer then tells the victim to go to the local bank and withdraw a large pile of cash. Next, they have the victim drive to a Bitcoin ATM — which they describe as a “U.S. government ATM” or a “safety locker.” The scammer commands the victim to feed wads of cash into the ATM, usually staying on the phone the entire time, and send it to the scammer’s wallet.

Fear of kiosk fraud is becoming a moral panic around the country — especially in states with large elderly populations. Maine, New Hampshire, and Vermont are the three most elderly states in America. Last year, Maine and Vermont both enacted de facto total bans on crypto kiosks.

Yet this kind of fraud is really nothing new. The methods used by kiosk scammers are ultimately no different from those used in a more familiar scheme: gift card scams.

FTC resources show that gift card scams are virtually identical to kiosk scams. The scammer calls an elderly victim, claims to be a government agent seeking payment, threatens the victim with jail, and then demands that the victim drive to a store —often Target — and buy large quantities of gift cards. The scammer then orders the victim to read the gift card “security numbers” over the phone.

According to the FTC, “gift cards are far more frequently reported than any other payment method for fraud.” Scammers favor them because, as with Bitcoin ATMs, they can get quick cash, and the transaction is irreversible.

While kiosk scams are on the rise, gift card scams remain more popular. According to the FBI’s Internet Crime Complaint Center, there were 10,956 reports of kiosk scams in 2024. In the same year, FTC statistics show 41,120 reports of gift card scams — almost four times more.

This disparity is sometimes disguised by the high prevalence of overall cryptocurrency-related fraud. In 2024, the FTC recorded 46,899 victims of general crypto-related fraud — a 12 percent higher number than for gift card scams. Yet the FTC, unlike the FBI, does not separate out kiosk-related scams. A big-picture comparison suggests that only perhaps 23 percent of cryptocurrency fraud involves kiosks. Most other kinds of crypto fraud are unrelated and do not target elderly people at all.

The similarities between gift card scams and Bitcoin ATM fraud are also critical. From a policymaking standpoint, they reveal the single most important feature of both scams: the victims of these scammers are entirely fungible between parallel scams.

Imagine an elderly American man who receives a call from someone with a thick Burmese accent identifying himself as an IRS agent. The scammer persuades the man to remain on the phone, drive to the bank, withdraw piles of cash, drive to a gas station, and then systematically feed the money into a mysterious “safety locker.”

Clearly, this victim could have just as easily fallen prey to an identical gift card scam or, for that matter, a wide variety of similar schemes. Even if both Target gift cards and Bitcoin ATMs were banned nationwide, the same victim could remain a sitting duck for the next trend in the global scam economy.

Any victim of kiosk fraud is vulnerable to any scam at all involving deference to authority, a compressed decision timetable, general unfamiliarity with the dangers of a globalized world, and an irreversible payment rail. Within those constraints, the same victim will buy piles of gift cards, feed stacks of cash into a strange machine, or hand gold to a stranger. He is, effectively, a puppet on the strings of any call center in Myanmar trained in social engineering. Suppressing this or that payment method cannot protect him.

In fact, we know that the same scammers use all of these methods interchangeably. In 2024, a U.S. grand jury indicted two Indian nationals who were identified as the masterminds of a scam syndicate that preyed on the elderly. The scammers variously directed victims to buy gift cards, deposit cash in crypto kiosks, and hand gold and cash to human couriers.

Victims of Bitcoin ATM fraud can be protected by preparing the elderly, educating their communities and caretakers, and increasing funding for interagency anti-fraud enforcement to identify and hunt down criminals. We will not help victims in the Granite State by suppressing business, turning away innovation, and weakening the New Hampshire Advantage.

On Tuesday, the House Commerce and Consumer Affairs Committee will hear SB 482, a bill to place modest guardrails on the crypto ATM industry. While the bill is moderate, AARP members and police chiefs have continually demanded that the bill’s restrictions be ratcheted up until crypto ATMs cannot operate at all.

New Hampshire is not a bystander in the digital asset economy—we are a leader. As a leader, we can continue to set a constructive example for the rest of the country with policies that encourage innovation, facilitate investment through stability, and protect our citizens through sensible guardrails. We cannot lead with impulsive and shallow politics.

Ian Huyet is a lawyer and a member of the Board of Directors of the NH Blockchain Council. He wrote this for NHJournal.com.

This story was originally published by the NH Journal, an online news publication dedicated to providing fair, unbiased reporting on, and analysis of, political news of interest to New Hampshire. For more stories from the NH Journal, visit NHJournal.com.