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Losses from bitcoin ( BTCUSD ) ATM scams soared above $110 million in 2023, a nearly tenfold increase in just three years, new data from the Federal Trade Commission (FTC) shows.

And the scams are only increasing in pace. In the first six months of 2024, the FTC disclosed that losses to bitcoin ATM scams exceeded $65 million.

Older adults, especially those over 60, were found to be more than three times as likely to fall victim to these scams compared with younger people. Across all age groups, the median loss during this period was a whopping $10,000.

How Do Bitcoin ATM Scams Work?

These specialized bitcoin ATMs, often located in high-traffic areas like convenience stores and gas stations, accept cash in exchange for cryptocurrency, making them an appealing tool for scammers.

Fraudsters often impersonate government officials, businesses, or tech support agents, and create a fake yet seemingly urgent need for the victims to withdraw money from their bank accounts and deposit the funds at a bitcoin ATM to "protect" their savings.

"As soon as consumers scan a QR code provided by scammers at the machine, their cash is deposited straight into the scammers’ crypto account," the FTC said in a release Tuesday.

Notably, bitcoin and other crypto transactions are irreversible, which means there is no recourse once the payment has been sent, outside of notifying law enforcement.

Bitcoin ATM Operators Can't Stop All Fraud

While bitcoin ATM operators claim to have implemented measures to deter fraud , such as providing warnings during transactions and offering live customer support, incidents continue to occur.

Bitcoin Depot ( BTM ) Chief Operating Officer (COO) Scott Buchanan emphasized his company’s regulatory compliance and consumer protection efforts but acknowledged that not all fraud can be prevented, NBC News reported recently.

The FTC suggests that the best way for consumers to protect themselves is to slow down, verify any suspicious communication, and avoid sending money through a bitcoin ATM at the urging of an unknown party.

Read the original article on Investopedia .