AUSTRAC Penalises Cryptolink $56K Amid Crypto ATM Money-Laundering Concerns

Australia’s financial crime watchdog, AUSTRAC, has penalized Queensland-based crypto ATM operator Cryptolink $56,340 for breaching anti-money-laundering and counter-terrorism-financing (AML/CTF) obligations. The move underscores AUSTRAC’s intent to tighten regulation of the digital asset sector, including online crypto casinos and exchanges that handle similar high-risk transactions.

The penalty, issued on 30 October 2025, follows a detailed investigation by AUSTRAC’s Crypto Taskforce. Investigators identified delayed reporting of large cash transactions and inadequate internal procedures to identify and mitigate money-laundering risks. Alongside the fine, the regulator accepted a court-enforceable undertaking requiring Cryptolink to overhaul its compliance systems and undergo external review.

Independent Audit and Compliance Reforms

As part of the undertaking, Cryptolink must engage independent experts to review its AML/CTF systems, confirm that all required cash transactions over $10,000 have been reported, and ensure its risk assessments meet current regulatory standards.

AUSTRAC clarified that paying an infringement notice does not represent an admission of liability but ensures immediate remedial action. The regulator also confirmed that Cryptolink has cooperated fully with the inquiry and paid the fine in full.

Crypto ATMs Identified as Laundering Hotspots

AUSTRAC’s task force revealed that 85 percent of transactions from the 90 most active crypto ATM users in Australia were connected to scams or money-mule activity. The findings have raised alarm over the ease with which criminals convert illicit cash into cryptocurrency.

Crypto ATMs, found in shopping centres, petrol stations, and convenience stores, offer fast, anonymous conversions between cash and digital currencies. Australia currently has just over 2,000 active crypto ATMs, a slight decline following stricter enforcement and compliance checks earlier in the year.

Authorities warn that the devices are increasingly used by organised crime groups and scammers to move stolen funds offshore. Victims, particularly older Australians, have reported losing tens of thousands of dollars after being tricked into depositing money through these machines under false pretences.

AUSTRAC Expands its Crypto Oversight

The action against Cryptolink follows AUSTRAC’s broader crackdown on crypto ATM operators. In July, the regulator introduced new conditions across the sector, including a $5,000 daily transaction limit and stricter identity verification for high-value transfers.

This is AUSTRAC’s second major enforcement action since those reforms took effect, following the deregistration of South Australian provider Harro’s Empire earlier in the year. The measures are part of a broader campaign to address vulnerabilities within digital payment systems and prevent the misuse of cryptocurrencies for laundering or funding illegal activity.

AUSTRAC Chief Executive Brendan Thomas has emphasised that compliance cooperation remains central to maintaining public trust in the crypto sector. Regulators intend to support legitimate operators while maintaining a firm stance against non-compliance.

A Warning for the Wider Crypto Sector

The Cryptolink penalty serves as a warning to the broader crypto ecosystem, including online crypto casinos and decentralised exchanges, where digital transactions carry similar AML/CTF risks. By mandating independent audits and detailed reporting, AUSTRAC aims to set a clear compliance standard for all digital asset businesses operating within Australia.

Officials have signalled that further enforcement actions are likely as oversight expands. While the government has not moved to ban crypto ATMs outright, unlike in the UK and New Zealand, it is considering legislation that would give AUSTRAC broader powers to regulate high-risk operators.

Turning Point for Cryptolink

For Cryptolink, the fine and oversight agreement represents an opportunity to rebuild trust. The company has pledged to strengthen internal systems and align fully with AUSTRAC’s compliance expectations.

As regulators continue their scrutiny, the case stands as a reminder that transparency, proper risk assessment, and swift reporting are now mandatory pillars of operating within Australia’s evolving digital currency environment.