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- In recent years scammers have extracted hundreds of thousands of dollars from Wisconsin residents through schemes involving crypto ATMs.
- Wisconsin lawmakers recently passed a law that regulates crypto ATMs, and law enforcement officials say they are already noticing a reduction in scam reports.
- The state opted not to ban the machines like in three other states in response to lobbying from the industry.
Robert Semanko told police he thought he couldn’t be scammed.
Then last October the 31-year-old father of three from central Wisconsin got a call from a scammer posing as the Chippewa County Sheriff’s Office. Semanko was told he missed jury duty, resulting in two citations, and owed an additional $2,000 fine. Over three hours the scammer tricked Semanko into inserting $7,000 into a crypto ATM.
Crypto ATM scams have become more prevalent in Wisconsin and throughout the U.S. in recent years, leading lawmakers to pass legislation. The scams have caused headaches for local law enforcement agencies and oftentimes pain, embarrassment and irreversible financial damage to victims.
Sen. Jesse James, R-Thorp, who as a Cadott police officer responded to Semanko’s case, co-authored recently approved legislation that places significant regulations on crypto ATMs statewide.
But unlike a handful of other states, including Minnesota and Indiana, Wisconsin opted not to ban crypto ATMs completely as lobbyists pressed regulation-averse Republican lawmakers for looser restrictions.
As the first law in Wisconsin to place consumer protections on crypto ATMs, Act 226 restricts daily transactions to $1,000, requires receipts after each transaction, mandates consumer identification and offers refunds to victims.
Now, incidents as severe as Semanko’s are far less likely to occur, according to lawmakers, law enforcement officials and Wisconsin’s Department of Financial Institutions.
“People need to be educated on this more,” James said. “I think with the new law, it’s gonna definitely help because people will be more well versed on how this is coming about.”
Crypto ATMs offer potential for scams
Cryptocurrency kiosks, also known as bitcoin ATMs or crypto ATMs, have sprouted throughout the United States in recent years. With at least 28,000 locations in the U.S., and around 700 in Wisconsin, these machines convert cash into a digital crypto currency, stored in a digital wallet similar to a bank account, with valuations depending on the market value of the cryptocurrency.
They are most commonly located at convenience stores, gas stations and grocery stores.
A CNN investigation found crypto ATMs charge 20-30% in transaction fees, far more than other forms of crypto purchasing. Because cash is the primary medium for crypto ATM deposits, transactions are often untraceable, which means lost money is often unrecoverable, making the machines an alluring instrument for scammers.
In a written statement, Coinflip, a major crypto ATM operator, said the company takes consumer protection seriously.
“We take proactive steps to mitigate fraudulent activity on our platform, including 24/7 customer support, multi-factor verification and ‘Safe in 6,’ an industry best-in-class consumer protection framework,” the company statement said.
Bitcoin Depot, formerly a major player in the crypto ATM industry, wrote the company is “fully committed to the fight against fraud.”
“It hurts our customers, damages our reputation, and undermines the integrity of the digital asset ecosystem,” a company spokesperson said, adding the company has “zero desire to profit from fraudulent activity.”
Despite reassurances from machine operators, crypto ATMs have contributed to sometimes enormous damage for many across all corners of Wisconsin.
In July 2024, a Dodge County woman lost $200,000 through a crypto ATM scam. A victim in Ozaukee County lost over $98,000 over 19 transactions in October 2024. And in September 2025 a Milwaukee County resident lost $114,000, a Dane County consumer reported losing $135,000 and a Walworth County victim reported a loss totaling $400,000.
Scammers disproportionately target older adults, with 86% of losses from crypto ATM scams involving Americans over the age of 60, according to Raj Shukla, AARP Wisconsin’s state director.
“A lot of people really have this idea that this only happens to our seniors in the state,” James said. “It happens to our young families as well.”
Fraudsters, often international actors, lead victims through an arduous, manipulative process.
Beth Sewall, a 63-year-old grandmother from the Fox Valley, told a Wisconsin Senate committee in February 2025 she clicked on an online pop-up ad, which led to continuous telephone calls with multiple people who compelled her into trips to her bank, a Shell gas station and a Home Depot. Within four hours she lost $20,000 after depositing the cash into a crypto ATM.
Her scammer, claiming to be an employee from her credit union, told her a $20,000 purchase was about to go through on a Chinese porn site, telling her she needed to go to the credit union and withdraw $20,000, which he would then help get back into her account, Sewall said in her testimony.
He rushed Sewall through the process, convincing her to quickly withdraw the $20,000 cash from her credit union.
The scammer then led her to a specific Coinhub kiosk located at the Shell station on Wisconsin Avenue in Appleton, where she inserted all $20,000.
“There are no words to express my feelings when I figured out that it was a scam,” Sewall said in her testimony. “I thought about killing myself,” she added.
Wisconsin, other states pass restrictions on crypto ATMs
Americans lost $333 million in scams involving crypto ATMs in 2025, up from $246.7 million in 2024 and $110 million in 2023.
In response, 36 states have passed legislation aimed at restricting crypto ATMs, including an outright ban of crypto ATMs in Indiana, Tennessee and Minnesota.
Wisconsin opted not to ban crypto ATMS, though early in the bill’s development lawmakers considered that possibility, bill co-author Rep. Patrick Snyder, R-Weston, said.
When Wisconsin’s bill was initially drafted in November 2025, the daily transaction limit was set at $500, which would have been the strictest daily transaction limit in the country.
Snyder said pro-crypto industry lobbyists pushed hard for a $10,500 first-time daily transaction limit. Snyder said Assembly Speaker Robin Vos pushed back on an outright ban.
“The speaker’s office said, ‘Yeah, we don’t want them to suddenly end as an industry in Wisconsin. Let’s make a compromise,’” Snyder said.
“We got a victory, but it could have been a little tougher,” Snyder added. “But I still think a $1,000 daily transaction limit is a lot better than what they were able to do before.”
Vos’ office didn’t respond to a request for comment.
The state’s restrictive legislation appears to be functioning as intended.
“We can confirm that the bill has, at least from the reports we’ve received of illicit activity involving these kiosks, had a marked effect,” DFI assistant chief legal counsel Michael Gavigan said. “I can definitely confirm that we’ve had fewer reports on our end.”
The state’s daily transaction limit paired with consumer ID mandates now makes scamming difficult for fraudsters, according to Greenfield Police Department Detective Scott Simons, a cryptocurrency investigator who has been recognized nationally for recovering crypto losses.
Because customers are required to input their ID to make a purchase, scammers can no longer use their own accounts on multiple people.
Meanwhile, Wisconsin’s $1,000 daily transaction limit keeps scammers from leading a victim from one kiosk to another in an attempt to bypass the daily limit.
“The scammers are not wasting their time trying to get $1,000 from a victim in Wisconsin,” Simons said.
“I’m not saying Wisconsin hasn’t seen any, but it has been a drastic drop,” Simons said. “When it’s $1,000 now, compared to, maybe they would have lost $20,000, a year ago, that’s a huge difference. Now they can get that refund too. So it’s effective.”
An October 2025 CNN report found that operators profit considerably off scam victimizations, even when the transaction turns out to be fraudulent. Operators have also been notoriously slow to release refunds, even when victims prove they have been defrauded.
Karin Schmeling, a 71-year-old scam victim from Greenfield, compared the situation to emotional manipulation. She lost $4,400 as part of a crypto ATM scam in September 2023.
“The company who owned the kiosk refused to refund even a portion of my money, despite my scrambling to file stacks of paperwork, much of which had to be notarized, within their declared timeline,” she wrote for her testimony for the Senate hearing on Feb. 25. “Despite my meeting their stated requirements, they concluded that I didn’t meet their criteria for even a partial refund and that they were under no obligation to explain why.”
As part of Wisconsin’s Act 226, crypto operators are now required to offer full refunds of money lost in scam cases if the victim contacts the operator and the Wisconsin Department of Justice, Department of Financial Institutions or a law enforcement agency within 30 days of the scam.
Troubling industry offers challenges for victims, law enforcement
In May Bitcoin Depot filed for bankruptcy, citing increasing restrictive legislation throughout the country making crypto ATMs unviable as a business model.
“States have imposed increasingly stringent compliance obligations, including new transaction limits, and in some jurisdictions, outright restrictions or bans on BTM operations; and operators have faced increasing litigation and regulatory enforcement,” Bitcoin Depot CEO Alex Holmes said in a statement. “These developments have materially affected Bitcoin Depot’s business and financial position. Under these circumstances, the Company’s current business model is unsustainable.”
Operators such as Coinhub, Bitcoin Depot and Coinflip say their machines are valuable for their simplicity in offering users an option to purchase crypto currency using cash. Operators market their machines as options for those who have trouble opening a bank account to participate in crypto transactions. Further, operators tout their machines for offering a higher level of privacy than traditional exchanges by not requiring users to input personal information.
However, a 2023 investigation by the Iowa attorney general found that more than 98% of money sent through Bitcoin Depot and almost 95% of the money sent through CoinFlip resulted in scam transactions.
In September 2025, the Washington, D.C., attorney general alleged in a lawsuit against Athena Bitcoin that fraud was involved in 93% of deposits made through Athena Bitcoin during the first five months of operation.
“We were one of the biggest players, and we were one of the first movers,” said Marc Grens, co-founder and president of DigitalMint, a Chicago cybersecurity firm that started as a crypto ATM operator in 2014 before pulling out of the industry. “The players, executive founders, just we’re kind of in on it on how dirty the industry is, allowing scam victimization.”
Grens disputed the argument that crypto ATMs offer opportunities for individuals who don’t have access to bank accounts.
“We found out all these customers were first going to their bank account, going to their bank, or an ATM, taking out cash, and then using that cash for proceeds,” Grens said. “So you can’t say that (customer is) underbanked. You literally go to a bank account, take money out.”
When Grens started DigitalMint, his company was one of the first crypto ATM operators in the U.S. He said DigitalMint eventually operated 1,400 locations across 35 states. He began to discover the company was being used as an outlet for vast amounts of fraud around 2018 and halted operations in 2024.
Based on an internal investigation, Grens determined that nearly all DigitalMint customers who made transactions of around $1,000 or more were fraud victims.
“I thought they were all idiots,” Grens said of his counterparts in the crypto ATM industry. “They didn’t provide any value. They just got in at an early time knowing that regulators and law enforcement (are) so laggard to do anything about it, you can get away with the greatest heist that we’ve seen in a while.”
Michael Litman, Concordia University Wisconsin’s computer science director and crypto expert, said crypto ATM operators are taking money from people who are “kind of being gullible about this crypto thing.”
“So, we could maybe call the ATM management people likely questionably unethical, but probably not criminal,” Litman said. “But what they’ve now enabled is for that gullible customer to now step into a world where a lot of corruption and malicious stuff does happen.”
The Wood County Sheriff’s Office found a creative way to help victims get their money back. In March 2023, the county started getting court permission to search and eventually seize money at crypto ATMs where the victim was reportedly defrauded.
The protocol eventually spread to several law enforcement agencies throughout Wisconsin.
Then in June 2024, Coinhub sued Wood County, accusing the county of wrongful seizure of cash from its kiosks. Coinhub argued the county skipped necessary steps in legally deciding what to do with the seized money.
“We didn’t even get a chance to say, hey, let’s adjudicate whose money this is. They just delivered it back to (the victim),” said Will Conley, who represented Coinhub in the lawsuit.
Wood County Sheriff Shawn Becker said the department gave the money back to the victim because prosecuting an individual who lived out of the country “would be really almost locally impossible to do.”
Coinhub’s petition for return of property was denied, and the motion was dismissed. The Wisconsin Court of Appeals affirmed the decision in February 2025.
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