Coin Cloud’s Bitcoin ATM Fraud
Yesterday, reports surfaced about a cyber fraud incident that affected a Bitcoin ATM company.
It’s important to note that the affected company is Coin Cloud, which declared bankruptcy in February this year.
Coin Cloud and the Bitcoin ATM Fraud News
Coin Cloud is a Las Vegas-based company that runs over 4,000 Bitcoin ATMs across the U.S., with assets ranging between $50 million and $100 million.
The company filed for bankruptcy in February due to liabilities of between $100 million and $500 million, with about 10,000 creditors. Its biggest creditor, Genesis Global Capital, lent it just over $100 million last year. Genesis filed for bankruptcy in January.
Both companies fall under Chapter 11 of the U.S. bankruptcy process, allowing them to restructure and potentially reopen despite filing for bankruptcy.
Although Coin Cloud filed for bankruptcy, its operations can continue.
The Attack
The attack was disclosed by vx-underground, with hackers claiming to have compromised Coin Cloud. The hackers allege taking 70,000 customer selfies from ATM cameras and 300,000 pieces of PII from Coin Cloud’s systems. The stolen PII includes social security numbers, date of birth, first name, last name, email address, phone number, current occupation, physical address from individuals in the U.S. and Brazil. They also stole the source code of the company’s entire management backend. No funds appear to have been stolen so far.
Bitcoin ATMs and the Cyber Fraud News
Bitcoin ATMs are automated machines enabling live individuals to buy and sell BTC. They are often placed in transit locations and connected to crypto exchanges or brokers that allow buying and selling in fiat currency. These machines struggle to meet customers’ demand for anonymity with the transparency required by authorities.
Crypto ATMs Around the World
There is a map of crypto ATMs around the world on Coinatmradar.com. While there are thousands in the US, Europe has relatively few compared to Canada and Australia. Countries like Spain and Poland stand out among European countries. Regulators frown upon these machines because they allow untraceable banknotes to be exchanged into cryptocurrency, facilitating free exchange of cryptocurrencies worldwide.
Hot Take: Cyber Fraud Threatens Bitcoin ATM Company
A major Bitcoin ATM operator faces a cyber fraud threat after hackers allegedly compromised its systems. Despite declaring bankruptcy earlier this year, Coin Cloud’s operations continue as it attempts to restructure under Chapter 11. The attack resulted in the theft of sensitive customer data but no funds were stolen. This underscores security challenges facing Bitcoin ATMs as regulators grapple with their implications worldwide.
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