Missouri AG Sues CoinFlip, Says Crypto ATMs Enable Fraud

Missouri Attorney General Catherine Hanaway has sued GPD Holdings LLC, doing business as CoinFlip, alleging the crypto ATM operator's network of kiosks has become a pipeline for consumer fraud. Hanaway called Bitcoin and crypto ATMs "the new getaway cars for fraud," seeking an injunction, consumer restitution, and up to $1,826,000 in civil penalties.

What Missouri alleges against CoinFlip

The lawsuit, announced on May 20, 2026, accuses CoinFlip of violating the Missouri Merchandising Practices Act by failing to protect consumers from scam-driven transactions processed through its machines. The state says CoinFlip operated 143 Bitcoin ATMs in Missouri as of September 26, 2025.

The petition also alleges that CoinFlip's transaction fees can run upwards of 20% of a transaction's value and were not routinely disclosed clearly to consumers. In one cited example, a user who made a $1,000 CoinFlip ATM transaction was refunded only $182.38 in fees.

Missouri is asking the court to enjoin CoinFlip from operating in the state entirely, impose civil penalties of up to $1,826,000, and award restitution to affected consumers. The attorney general's office says it has handled 350 crypto cases involving a cryptocurrency ATM over the past two years.

"Bitcoin and crypto ATMs are the new getaway cars for fraud."

— Catherine Hanaway, Missouri Attorney General

CoinFlip has denied the allegations. A company spokesperson called the lawsuit "meritless," according to local reporting from KCTV5.

Why crypto ATMs face growing fraud scrutiny

The Missouri case fits a broader enforcement pattern. Scammers frequently direct victims to crypto ATMs to convert cash into cryptocurrency, which is then sent to wallets the scammer controls. Unlike bank wire transfers, these transactions are largely irreversible once confirmed on the blockchain.

Federal Trade Commission data show that fraud losses at Bitcoin ATMs increased nearly tenfold from 2020 to 2023 and topped $65 million in the first half of 2024 alone. The median reported loss was $10,000, with older adults disproportionately affected.

Missouri is not the only state targeting CoinFlip. Iowa's attorney general sued CoinFlip and Bitcoin Depot in February 2025, alleging the operators enabled scam losses exceeding $20 million and profited through large transaction fees. The regulatory pressure on crypto ATM operators is compounding across multiple jurisdictions.

The enforcement wave comes as the broader crypto market navigates its own uncertainty. Bitcoin traded near $76,754 at press time, and the Fear and Greed Index sat at 29, reflecting a "Fear" reading. Separately, Binance recently announced temporary suspensions of ETH deposits and withdrawals, underscoring the operational complexity crypto platforms face even outside enforcement actions.

What the case could mean for operators and users

If Missouri prevails, the case could establish a template for other state attorneys general to pursue crypto ATM operators under existing consumer protection statutes. The allegations center not on cryptocurrency itself but on the operator's compliance practices, specifically inadequate fee disclosure and insufficient fraud prevention measures.

For crypto ATM operators nationwide, the lawsuit signals that state regulators view them as money services businesses with affirmative obligations to protect consumers from scam transactions. Operators that rely on minimal KYC thresholds and opaque fee structures may face similar actions, particularly as state-level regulatory scrutiny of crypto products intensifies across multiple fronts.

For consumers, the Missouri filing reinforces a simple warning: any unsolicited request to deposit cash at a crypto ATM is almost certainly a scam. The FTC, state attorneys general, and law enforcement have all flagged this pattern. No legitimate government agency, utility company, or tech support service will ever direct someone to pay via a Bitcoin ATM.

The case is in its early stages. Missouri's petition has been filed, but no hearing date has been set. Whether CoinFlip negotiates a settlement or fights the allegations in court will determine how quickly, and how broadly, this precedent shapes the crypto ATM industry. Meanwhile, the wave of enforcement actions and security incidents across the crypto sector shows no sign of slowing.

Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Cryptocurrency and digital asset markets carry significant risk. Always do your own research before making decisions.