Massachusetts city moves to ban all 8 of its Bitcoin ATMs over scams targeting older residents

A Massachusetts city is moving to ban Bitcoin ATMs, citing scams that pressure victims, particularly older residents, into feeding cash into the machines. Newburyport’s City Council unanimously referred Ordinance 230 to its General Government Committee, a first step before any final vote.

Newburyport has eight crypto ATMs and does not currently license them, according to Councilor-at-Large Edward Cameron Jr., who introduced the measure with Council President Heather Shand.

Council considers cryptocurrency ATM ban

Newburyport City Council is considering Ordinance 230, a proposal that would prohibit the installation and operation of cryptocurrency machines, commonly known as Bitcoin ATMs, Bitcoin kiosks or virtual currency kiosks.

The measure was introduced by Councilor-at-Large Edward Cameron Jr. and City Council President Heather Shand. Cameron said the proposal was developed in consultation with the Newburyport Police Department and Planning and Development Director Andrew Port.

Cameron told the council that cryptocurrency ATMs have increasingly become associated with scams in which criminals impersonate banks, government agencies or creditors and pressure victims into making urgent payments.

Victims are typically instructed to withdraw cash and deposit it into a cryptocurrency ATM, where the money is converted into cryptocurrency and sent to an address controlled by the scammer.

According to Cameron, the problem has affected residents in Massachusetts, particularly older people. He also argued that tracing the funds can be difficult once they have been transferred through cryptocurrency networks.

Newburyport has eight Bitcoin ATMs, according to Cameron, and the city currently does not license them.

The council did not immediately approve the ban. Instead, members voted unanimously to refer Ordinance 230 to the General Government Committee for further consideration.

Why crypto ATMs have become a target

Crypto ATMs have faced growing scrutiny across the United States as scammers have incorporated them into fraud schemes.

Unlike conventional bank transfers, a victim using a crypto ATM can be instructed to convert physical cash into cryptocurrency and send it directly to a wallet controlled by a criminal.

That has made the machines particularly attractive in impersonation scams, where victims may be told that their bank account, computer or government benefits are at risk unless they make an immediate payment.

For local authorities, the challenge is not necessarily cryptocurrency itself but the way the machines can be exploited by criminals.

Newburyport’s proposed ordinance therefore represents a debate over access to cryptocurrency infrastructure rather than a broader prohibition on residents owning or using digital assets.

The distinction is important. A ban on physical cryptocurrency kiosks would not prevent residents from buying, selling or holding Bitcoin through online exchanges or self-custody wallets.

Instead, it would remove a physical access point that officials believe scammers are exploiting.

Data centers face separate scrutiny

Newburyport is also examining restrictions on large data centers, although the issue is being addressed primarily through zoning rather than the cryptocurrency ATM ordinance.

City planning officials have raised concerns about the amount of electricity and water that major data centers can require, particularly because of the cooling systems used by large computing facilities.

During a June Planning Board discussion, Planning Director Andrew Port said large data centers are typically facilities with significant water and energy requirements. The board considered a zoning amendment that would make clear that major data centers could not be treated as ordinary office, industrial, warehouse or similar uses.

Water availability emerged as one of the central concerns.

Officials discussed whether Newburyport’s existing infrastructure could support a large data center without affecting the city’s ability to accommodate future development. The Planning Board also considered whether smaller facilities needed for telecommunications or other infrastructure should be treated differently from large-scale data centers.

By August, the proposed zoning changes were still under consideration, with a Planning Board process aimed at adding data centers to the list of prohibited uses.

Digital infrastructure meets local regulation

The debates highlight a broader challenge facing municipalities as digital infrastructure expands.

Cryptocurrency ATMs offer physical access to digital assets, but officials in Newburyport are concerned that the same infrastructure can facilitate financial fraud.

Data centers, meanwhile, provide the computing infrastructure required by modern technology, including cloud services and artificial intelligence, but can place significant demands on local power and water systems.

For Newburyport, the question is therefore not simply whether the city supports or opposes new technology. It is whether the infrastructure required to operate that technology fits within local priorities and resources.

The city has not yet finalized the proposed cryptocurrency ATM ban. The measure remains subject to further consideration by the General Government Committee and the City Council.

Newburyport’s City Council is made up of 11 councillors, including five at-large councillors and six ward councillors. The council is responsible for adopting and amending city ordinances.

If approved, the crypto ATM restrictions would make Newburyport another U.S. municipality responding to the growing use of cryptocurrency kiosks amid concerns over fraud and consumer protection.