Texas crypto kiosk scams cost residents $56.8M as lawmakers weigh next steps

Texas crypto kiosk scams cost residents $56.8 million in 2025, the highest total reported by any state, according to FBI data presented to a state legislative committee Thursday. For retail investors and everyday crypto users, the warning is direct: cash-to-crypto machines can move money fast, and that speed makes scam losses hard to reverse.

The FBI recorded 1,179 complaints from Texans tied to cryptocurrency kiosks, out of 13,460 complaints nationwide. Reported U.S. losses from the machines rose 58% to $389 million in 2025, according to the bureau’s figures.

Crypto kiosks, often called Bitcoin ATMs, let customers insert cash and receive cryptocurrency. They are commonly found in gas stations and convenience stores, and The Texas Tribune has counted about 4,000 of them across Texas.

How do crypto kiosk scams work?

Scammers typically persuade victims to take cash out of a bank account and deposit it into a kiosk. The machine converts that cash into crypto and sends it to a wallet controlled by the scammer, which can put the money outside the reach of banks and traditional chargeback systems.

Jesse Saucillo, deputy commissioner at the Texas Department of Banking, told lawmakers that recovery becomes difficult once funds move to an unhosted wallet. An unhosted wallet is a crypto wallet controlled directly by a person rather than a bank, exchange or other financial company.

Saucillo said the money can then enter a mixer, a service that blends crypto transactions to make tracing funds harder. He also said artificial intelligence-generated impersonations of police and state agencies are making scam calls more convincing.

What Texas lawmakers heard

The Texas House Committee on Homeland Security, Public Safety and Veterans’ Affairs was taking invited testimony on foreign financial influence when the discussion turned to crypto kiosks.

Rep. AJ Louderback told the committee, “In my career, I’ve never seen a more efficient, cleaner way to steal money.” Kelley Currie, a fellow at the Atlantic Council, said Interpol now treats scamming as an industry comparable to drug and human trafficking.

Currie also alleged that gas station kiosks “are run by Chinese money launderers.” The U.S. Justice Department has charged Chinese nationals in cases involving crypto fraud compounds in Southeast Asia and has prosecuted Chinese money laundering networks accused of moving scam proceeds. The department has not said those groups generally operate crypto kiosks.

What other states have done

AARP says about 30 states have passed laws related to crypto kiosks since 2023. South Dakota limits transactions to $1,000 per day and $10,000 per month, and requires full refunds for fraud victims. Wisconsin and Virginia have pursued similar caps.

Maine’s regulator reached a $1.9 million settlement with Bitcoin Depot to reimburse victims, according to state records. Other states have gone further: Indiana banned the machines in March, becoming the first state to do so, and Tennessee and Minnesota later followed with their own bans.

Rep. Cole Hefner, the Texas committee chair, said the state may consider “doing more than regulating them” and suggested legislation could be coming. He described the idea to colleagues as “kind of simple, but kind of abrupt.”

This story draws on original reporting from Decrypt.