This Seattle Company Owes $300K for Crypto Kiosk Mischief—Here’s Why Californians Care

by

If you’ve ever gazed at one of those mysterious machines in the corner of your local food emporium—the cryptically glowing crypto kiosks sandwiched between the Redbox and the nutritionally questionable beef jerky—chances are you’ve encountered Coinme. Hailing from Seattle (a city that never met a “FinTech” it didn’t like), Coinme’s big claim to fame, besides confusing the elderly, is that it just became the first company smacked by the California Department of Financial Protection and Innovation (DFPI) under its sparkling Digital Financial Assets Law. That’s DFAL for people who like their acronyms as much as their Bitcoin.

Here’s what happened: Coinme showed an absolutely remarkable disregard for the rules—letting people swap or scoop up more than $1,000 a day from their machines. Apparently, they also thought that receipts are merely “suggestions” and left off a few key disclosures. Not exactly consumer-friendly, unless you’re an aspiring international man of mystery.

So, California, never at a loss for drama (earthquakes, wildfires, gluten-free everything), has pronounced Coinme $300,000 poorer—$51,700 of which is going to an elderly local who was less than thrilled to find their savings shrink faster than an ice cube in Bakersfield. Plus, Coinme has to promise, cross their hearts and hope not to get regulated again, that this sort of thing won’t happen in the future. 📝

The big boss at DFPI, KC Mohseni, took a break from their daily regulatory powerlifting to warn all crypto kiosk operators that when California says “stop,” it doesn’t mean “think about slowing down.”

“This enforcement action should send a strong message…”
Translation: ‘If you put a crypto ATM in a 7-Eleven, try following the rules next time, okay?’

Turns out, the crypto kiosk gold rush has been an all-you-can-lose buffet for scammers. Between 2020 and 2023, reported fraud losses through these kiosks ballooned like a Silicon Valley IPO—almost ten times bigger in just three years. The FBI is now tracking hundreds of millions of dollars funneled through these handy cash-disappearance devices. Seniors, bless their innocent curiosity, are getting fleeced at rates that could make a Nigerian prince blush: they are apparently three times more likely than anyone else to trust a machine with flashing lights. 🤦‍♂️

California tried to put a cork in it with the DFAL, but they aren’t the only ones. Illinois sent their regulatory hopes to the governor (no word if the bill was packaged with a Chicago hot dog for easier digestion). Vermont hopped on the bandwagon with daily transaction caps in May. Nebraska, probably wondering what a crypto kiosk even is, requires ATM operators to get a license as of March.

So if you’re thinking about investing your life savings in Bitcoin via an ATM squeezed between a lotto ticket stand and old magazines, at least you’ll know that somewhere, in a fluorescent-lit Sacramento office, someone is watching out for you. With acronyms. Lots and lots of acronyms. 🚨

Read More

2025-06-28 20:39