Arizona has managed to reimburse cash amounting to $171,332 to 35 victims of crypto ATM scams as per a refund law, enacted last September, which is part of a crackdown on cash-to-crypto conversions prevalent in the United States and elsewhere.The change is clear in the machines themselves. Data from Coin ATM Radar reveal that the number of crypto ATMs worldwide has dropped from its peak of 40,072 units in December 2022 to 27,524 units on August 13, 2026, a decline of 31.3%. The decline in the US is more severe, with the number of installed machines decreasing from a high point of 35,037 units in August 2022 to 19,754 units on August 12, 2026, a drop of 43.6%.This happens even as Fortune Business Insights states that the global crypto ATM market was worth $356.72 million in 2025 and that the market will grow at a CAGR of 54.8% until the year 2034. North America contributed to 88.7% of the revenue in 2025, which makes US government regulations crucial for the future of the industry.How Arizona is clawing money backArizona Attorney General Kris Mayes has stated that her office has arranged for full refunds of 35 victims who had registered their complaints within 30 days.HB 2387, which came into effect on September 26, 2025, compels the operators to reimburse the affected new customers in case they reported the fraudulent transaction to law enforcement or the Attorney General within 30 days of that.Additionally, it has a limit on daily transactions set at $2,000 for new customers and $10,500 for old customers, as it also imposes the obligation to provide scam warnings and acknowledgment screens, not to mention the receipt that contains the address of the destination wallet.“My office is happy to help any victim of crypto ATM fraud receive a refund they are entitled to under Arizona law,” Mayes said.Arizona’s ordeal mirrors the more serious issue of complaints related to crypto-kiosks. The FBI’s data indicated that in the year 2025, there were about 13,460 complaints across the US with losses amounting to $388.98 million. More than half of the complaints have been made by people over 50 years of age, with losses of $302 million. Arizona alone accounted for 460 complaints and losses of $14.53 million.The crackdown reaches beyond the USArizona is part of a global movement to combat fraudulent activity tied to cryptocurrency ATMs and improve oversight.Australia’s financial regulator, AUSTRAC, temporarily suspended the operations of Cryptolink on August 9 and shut down 96 machines in total. Germany’s BaFin acted against crypto machines in a countrywide raid in 2024, while the UK’s Financial Conduct Authority stopped operations at 26 illegal crypto machines in 2023.US states are progressing in a similar manner. As reported by AARP, since 2023, 30 states have put laws in place about crypto kiosks, of which 13 laws were adopted in 2026. While Indiana, Tennessee and Minnesota are trying to prohibit crypto kiosks, other states have limited transactions, issued rules of licensing or provided for refund protection.Moreover, Cryptopolitan covered the crypto ATM ban in the Massachusetts Senate, the scam warnings of Bitcoin ATMs in San Antonio, the intention of Indiana lawmakers to invest in crypto, and the initiatives taken by Alaska to reimburse the victims of Bitcoin Depot scam through their reports.Hawaii is taking another restrictive step. A law set to take effect Oct. 1 will prohibit crypto kiosks from accepting US dollars in exchange for digital assets.In Congress, Representatives Sean Casten and Elvira Salazar put forward the bipartisan Stop Crypto ATM Scams Act, under which operators of Bitcoin kiosks are to comply with additional regulations on registration, anti-money laundering, and consumer protection.Why regulators are concernedThe worry is more than just about how many scams occur. According to TRM Labs, illegal acts make up approximately 1.2% of the cash-to-crypto volumes, which is nearly double its estimate for the larger crypto industry, which is 0.63% . The company also reports that since 2019, they have traced over $160 million in illicit funds.FinCEN issued a warning of its own in August 2025.According to the FBI, there exists a specific fraud scheme whereby perpetrators tell their victims to take money from their bank accounts and send it to a crypto kiosk, all while keeping the phone line open. Older Americans are particularly prone to being victims of this scheme.What the contraction means for cryptoThe shrinking ATM network is unlikely to cause a direct shock to Bitcoin prices or global crypto liquidity. Crypto ATMs account for only a small share of overall digital-asset trading.The more significant impact is structural rather than functional. Data from Coin ATM Radar indicates a global reduction of nearly 30% in the overall number of crypto ATMs beginning in early 2026. A similar reduction of 36% has taken place in the number of ATMs operating in the US. This means that physical access to cryptocurrencies is diminishing even though forecasts for the crypto ATM industry are optimistic.Furthermore, recent legislation in Brazil, tightening its regulations on selected crypto transfers to prevent fraud, illustrates that the trend is not confined to ATMs.For operators, this translates into rising compliance expenses and stricter transactional regulations. In terms of those who use cash instead of banks or centralized exchanges, it means that there are fewer options to participate in the digital-asset market.The growth potential for the crypto automatic teller machine market may still be promising. But the data on installations imply that regulatory risk is no longer a future issue for its physical presence, but is actually already changing it. If you're reading this, you’re already ahead. Stay there with our newsletter.