The Canadian federal government has announced a national ban on crypto ATMs. Roughly 4,000 machines currently operating in Canada are affected. Ottawa justifies the move with the misuse of these devices for fraud, money laundering, terrorism financing and sanctions evasion.
The plan is part of a broader package of measures against financial crime. At the same time, the government introduced legislation for a new Financial Crimes Agency headquartered in Ottawa. Canadians will still be able to buy cryptocurrencies in physical stores. However, the Department of Finance has not yet provided concrete implementation details. Moreover, no effective date appears in the current Spring Economic Update.
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Package of measures against money laundering and fraud
The Spring Economic Update outlines a bundle of financial allocations. For the new Financial Crimes Agency, the federal government is providing CAD 352.7 million (USD 257 million) over five years. Furthermore, ongoing funding of CAD 82.1 million (USD 60 million) per year follows afterward. In addition, the Public Prosecution Service of Canada receives CAD 46.2 million over five years. Meanwhile, the Department of Finance gets a further CAD 19.6 million.
FINTRAC, the Canadian financial intelligence agency, will also be strengthened. Over four years, CAD 17.9 million (USD 13 million) will flow into the detection and disruption of illicit financing flows. The focus is on extortion as well as the fentanyl trade. As a result, the measures target not only crypto ATMs but also money services businesses more broadly. For example, currency exchanges and digital payment providers fall under the scope.
Justice Minister Sean Fraser is responsible for the accompanying criminal law reforms. According to the original text of the economic update, the government intends to protect Canadians by combating the criminal misuse of so-called money services businesses. Therefore, stricter regulation, new enforcement powers and a ban on crypto ATMs aim to curb money laundering, terrorism financing, sanctions evasion and fraud.
High crypto ATM density meets growing fraud losses
Canada has the highest crypto ATM density per capita in the world. For every one million inhabitants, there are roughly 91 machines. With about 3,839 devices according to CoinATMRadar, the country holds nearly 9.9 percent of the global crypto ATM stock. Market leader Localcoin alone operates over 1,000 locations. Furthermore, the top 10 operators together control 92.2 percent of the market.
According to data from the Canadian Anti-Fraud Centre, victims reported losses of CAD 14.2 million from crypto ATM fraud in 2024. In the first quarter of 2025 alone, reported losses already stood at CAD 4.2 million. Moreover, the agency estimates that only 5 to 10 percent of cases are even reported. Therefore, the actual damages are likely to be many times higher.
The CAFC documents that seniors in particular fall victim to these scams. For example, a 76-year-old retiree from Calgary lost over CAD 12,000 at two different crypto ATMs. Such losses typically follow a social engineering attack. The scheme usually follows the same pattern. Callers pose as government officials and instruct victims by phone. Subsequently, victims withdraw cash and deposit it at a crypto ATM.
FINTRAC flagged risks back in 2023
The Canadian financial regulator had documented the problem early on. As early as February 2023, FINTRAC published an analysis of suspicious transaction reports. In it, the agency identified crypto ATMs as the primary tool for fraud and money laundering. Fraud was the predominant predicate offense, followed by human trafficking for sexual exploitation and cybercrime.
The typical scheme according to FINTRAC works as follows. Criminals deposit cash at a crypto ATM. Subsequently, they route the funds through several private wallet addresses to high-risk exchanges in Iran, Russia or Belarus. Geographic hotspots include the Greater Toronto Area, the Greater Montreal region and Metro Vancouver. In addition, perpetrators deliberately keep deposits below CAD 999 to bypass reporting thresholds. Furthermore, they use forged identities and prefer transactions during the night hours between 9 p.m. and 3 a.m.
Internationally, Canada is therefore in line with a trend toward stricter regulation. In the United Kingdom, the Financial Conduct Authority has banned all unregistered crypto ATMs. As a result, the number of bitcoin ATMs in the UK fell from 80 in March 2022 to just ten devices most recently. This represents a decline of around 88 percent. In the United States, Tennessee became the second state to ban crypto ATMs. Meanwhile, in Minnesota the House of Representatives passed a corresponding bill. The global crypto ATM stock dropped by 597 machines to 38,928 devices in the first quarter of 2026. At the same time, FINTRAC revoked the licenses of several dozen crypto service providers this year. These include exchanges and wallet providers. However, Ottawa has left open exactly when the announced ATM ban will take effect.
