Australia's Crypto ATM Crackdown: New Powers Target Money Laundering in 2025 DeFi Landscape

Australia is ramping up its fight against cryptocurrency-related financial crimes with sweeping new regulatory powers aimed at curbing crypto ATMs, deemed a “high-risk product” by Home Affairs Minister Tony Burke. Announced on October 15, 2025, the measures grant the Australian Transaction Reports and Analysis Centre (AUSTRAC) authority to restrict or prohibit crypto ATMs, part of broader anti-money laundering legislation set for parliamentary introduction in the coming months. This escalation follows a surge in ATM numbers—from 23 six years ago to over 2,000 today—and data revealing 85% of top users’ transactions linked to scams or money mules. As DeFi TVL exceeds $150 billion globally, Australia’s move underscores 2025’s regulatory focus on blockchain transparency, potentially impacting crypto adoption but enhancing user protections in volatile markets.

The Surge and Risks: From 23 to 2,000 ATMs

Crypto ATMs in Australia have exploded, enabling cash-to-crypto conversions but facilitating illicit flows. AUSTRAC’s analysis highlights their role in money laundering, terrorism financing, drug trade, and child exploitation. Burke stated: “When they looked at the top users… 85% of the money going through… involved scams or money mules.” Previous actions include a March “notice” to operators, June’s $5,000 transaction caps, and the revocation of Harro’s Empires registration. These target untraceable cash purchases, with most ATMs now requiring KYC, but gaps persist.

• Growth Stats: 200 ATMs three years ago; 2,000+ now.
• Crime Link: 85% top-user transactions tied to fraud.
• Enforcement Tools: AUSTRAC restrictions; no outright ban to avoid challenges.

Implications for Crypto Users and DeFi in Australia

For everyday crypto users, the powers could limit ATM convenience, pushing reliance on regulated exchanges and fiat ramps, increasing traceability but curbing anonymity. DeFi participants may see indirect effects, as enhanced scrutiny on cash entry points bolsters overall blockchain compliance under frameworks like MiCA equivalents. James Volpe of uCubed noted: “AUSTRAC appears focused on targeting criminal misuse rather than stifling innovation,” advocating “smarter collaboration” via automated monitoring. In 2025’s $2.5 trillion crypto market, this could foster trust but slow retail onboarding, contrasting global ETF booms.

• User Impact: Fewer ATMs; stronger KYC for fiat-crypto bridges.
• DeFi Ripple: Boosts secure on-ramps; potential for RWA scrutiny.
• Global Context: Aligns with U.S. GENIUS Act; eyes $40B+ TVL growth.

2025 Outlook: Balancing Regulation and Innovation

With legislation imminent, Australia’s crackdown may set precedents for G20 peers, promoting compliant DeFi while curbing risks. Expect expansions to other high-risk channels.

In summary, Australia’s crypto ATM powers prioritize anti-crime measures, shaping a more secure but regulated DeFi future in 2025.