U.S. police sawed open Bitcoin ATM: Cash taken away, violent law enforcement? Operators furious, who will compensate for the financial loss?

Texas police were caught on video using a chainsaw to forcibly dismantle a Bitcoin ATM, igniting a violent seizure controversy. Operators protested the machine being scrapped and the cash inside being claimed, indicating major issues in the law enforcement process. (Background: Spokane, the second-largest city in Washington, 'bans Bitcoin ATMs' as the first shot in the U.S. to strengthen KYC against fraud.) (Supplementary Background: Australia strengthens regulation of Crypto Assets ATMs: cash transaction limit of AUD 5,000, dual upgrades on KYC and monitoring.) In June this year, police in Jasper County, Texas, publicly sawed open a Bitcoin Depot Bitcoin ATM, taking the $32,000 in cash inside in a plastic bag, while the $14,000 ATM machine was immediately written off. The police released footage of the scene, escalating the controversy over violent seizures. Source of the image: Jasper County Sheriff’s Office – TX Heavy-handed enforcement angered operators. Bitcoin Depot's Chief Legal Officer Chris Ryan pointed out that the police skipped normal procedures, directly destroying the machine and withdrawing cash: "What they are actually doing is creating another victim, which is us, because of property damage and funds being seized." Chief Operating Officer Scott Buchanan added that the company could unlock the cash box remotely at any time, "but the cut machine has no repair value and can only be scrapped entirely." According to a report by Decrypt, similar violent enforcement actions against Bitcoin ATMs occur about 20 times a year, accounting for a small portion of total seizures, but causing significant equipment loss and high civil litigation costs. Bitcoin Depot's model allows users to input cash, while the company simultaneously sells an equivalent amount of Bitcoin and transfers it to a designated Wallet, with cash becoming the company’s revenue upon transaction completion. The Iowa Supreme Court recently ruled in two cases supporting operators, affirming that the cash belongs to Bitcoin Depot, but some county and city police still forcibly seize it under the pretext of 'criminal proceeds.' Texas police seize cash from inside the ATM | Source of the image: Jasper County Sheriff’s Office – TX Fighting fraud, operators are victimized. The FBI's 2024 statistics show that the public suffered at least $247 million in fraud losses through Crypto Assets ATMs, a 31% annual increase. Fraudsters impersonate government officials or banks, asking victims to deposit cash on-site and scan a QR Code; once Bitcoin is transferred, it is difficult to recover. Bitcoin Depot claims to have shared Elliptic tracking tools with local police, and has also sent former law enforcement personnel to explain the process, assisting victims in reporting to the FBI IC3; however, without standard procedures, "smashing open machines to take money" could happen again, and local governments usually have no budget to compensate for damages. Bitcoin Depot has already recovered cash and sought repair fees through lawsuits in states like North Carolina and Virginia, proving that legal avenues are feasible. Operators strongly urge legislative bodies to clearly define the ownership of cash and digital assets in fraud prevention, establish compensation mechanisms, and require law enforcement to notify operators to attempt remote unlocking before seizing. Fighting fraud but causing harm to related operators is not only happening in the U.S.; it is frequently reported by Crypto Assets traders globally. The main issue is that relevant financial laws have yet to extend to this area, and law enforcement responses are immature. Otherwise, have you ever heard of a bank's ATM being sawed open by the police? Related reports: Spokane, the second-largest city in Washington, 'bans Bitcoin ATMs,' firing the first shot in the U.S. to strengthen KYC against fraud. New ATM withdrawal regulations: 'Partial face visibility' may trigger alarms, trial in Tainan starting in May to combat fraudsters. 'U.S. police saw open Bitcoin ATM: cash taken away, violent enforcement? Operators are furious about who will compensate for the losses.' This article was originally published in BlockTempo, the most influential Blockchain news media.