Have you ever wanted or needed to buy or sell cryptocurrency on a whim, without being connected to the internet?
Have you ever felt like shelling out 100,000 satoshis or so at 3am to treat your party buddies to a kebab festival on their way home after a big night out?
Well, if you live in the UK, you can’t easily do any of these things anymore.
Last Friday, the UK’s FCA, in a nutshell Financial Conduct AuthorityPublication of an official bulletin entitled: Warning about illegal crypto ATMs operating in the UK.
You might think this would leave a bunch of legal ATMs online, but the FCA says that there are, in fact, no properly registered cryptocurrency ATMs anywhere in the country, so they should all shut down at once, otherwise:
Crypto ATMs offering crypto-asset exchange services in the UK must be registered with [the FCA] and compliance with UK Money Laundering Regulations (MLR). None of the crypto asset companies registered with us have been approved to provide crypto ATM services, which means that none of them operating in the UK are doing so illegally and consumers should not use them.
‘Disorganised and high risk’
It is not clear whether the FCA’s main concern is specifically that unscrupulous operators could make it easy for criminals to cash out large crypto payments without tracking.
After all, if you are buying or selling cryptocoins via an existing payment card account or mobile payment system, from an ATM in a shopping mall, you would think the process would be at least as traceable as any transaction involving a non-cryptocurrency account, Like buying big money at a department store or a luxury brand store.
However, the FCA appears to be concerned that these devices could make it easier for vulnerable individuals to indulge in crypto-related scams, by lowering the entry barrier to acquiring cryptocurrency in the first place:
We are concerned about crypto ATMs operating in the UK and will therefore contact the operators to advise them to shut down the machines or face further action.
Since we published a list of unregistered crypto companies that may have been continuing to do business, a recent assessment found that 110 companies are no longer in business.
We regularly warn consumers that crypto assets are unregulated and high-risk which means people are unlikely to get any protection if things go wrong, so people should be prepared to lose all of their money if they choose to invest in them.
While online cryptocurrency exchanges can require some sort of document-based registration process, such as requiring new buyers to upload personal ID scans first (we won’t discuss the pros and cons of this approach here, just to mention them), it’s hard to see how a device can Conveniently placed cryptocurrency ATM in a local shopping center conduct a lot of useful KYC in advance.
A cryptocurrency ATM can snap a picture of you in front of the machine, of course, and no doubt they’re doing it for it anyway, but rules are rules, regulations are regulations, and whatever hoops a UK registered ATM operator needs to jump in to make sure Than they are properly licensed…
…no one seems to have jumped after those hoops properly.
According to the BBC, there were less than 100 crypto-operated ATMs in Britain last week anyway, but we’re guessing the number is now zero.
This is the closest we’ve learned to Sophos HQ (we took a quick ride to check it out during our lunch break); You can see that this guy is still running, but he’s rejecting clients wholeheartedly:
