Missouri Sues CoinFlip Over Crypto ATM Fraud Allegations
Missouri Attorney General Catherine Hanaway has filed a lawsuit against CoinFlip, one of the largest cryptocurrency ATM operators in the U.S., alleging the company knowingly enabled fraudulent transactions and profited from them. The case, filed on May 20 in Jasper County, seeks to bar CoinFlip from operating in Missouri and imposes potential civil penalties of up to $1.8 million.
The lawsuit targets GPD Holdings LLC, which operates under the CoinFlip brand, accusing the company of violating the Missouri Merchandising Practices Act. The Attorney General’s Office claims that CoinFlip facilitated scams such as romance fraud, fake investments, and extortion, disproportionately affecting vulnerable groups like seniors and veterans. Over the past two years, Missouri State Highway Patrol data links 350 crypto fraud cases to cryptocurrency ATMs, many of which involved CoinFlip machines.
CoinFlip operates 136 ATMs in Missouri and over 4,200 across the U.S., often located in convenience stores, gas stations, and other high-traffic retail outlets. The company charges fees that critics allege are both excessive and not adequately disclosed, further compounding the financial harm to victims of scams.
Missouri began investigating crypto ATM operators in December 2025, amid growing concerns over fraud risks and deceptive pricing. The probe also included Bitcoin Depot, another major operator, which filed for Chapter 11 bankruptcy earlier this month. Bitcoin Depot cited over $20 million in potential legal judgments and ongoing litigation as existential threats to its business viability.
This lawsuit adds to a broader trend of regulatory scrutiny targeting crypto ATMs. Some states, like Minnesota, are considering outright bans due to their association with fraud. Meanwhile, municipalities and state governments across the U.S. have implemented stricter regulations or enforcement actions against these machines, citing their use in scams and money laundering.
CoinFlip has not yet publicly commented on the lawsuit.
What’s at Stake? The outcome of this legal battle could have significant implications for the crypto ATM industry. If Missouri successfully enjoins CoinFlip from operating and secures monetary penalties, it could set a precedent for other states to take similar actions. For traders and investors, increased regulatory scrutiny may dampen the growth of crypto ATM networks, which have been a critical on-ramp for retail users entering the cryptocurrency market.
The lawsuit also raises questions about the balance between accessibility and regulation. While crypto ATMs offer convenience, especially for unbanked populations, their association with fraud risks could drive stricter oversight, potentially limiting their reach.