The City of Stillwater is considering possible restrictions or even an outright ban on cryptocurrency machines, according to city officials.

Stillwater police are reporting scams where residents have been targeted to make cash transactions to digital accounts using cryptocurrency machines.

“Some of them are pretty scary and pretty convincing,” said Stillwater Police Chief Brian Mueller. “We have individuals in our community that are scared out of their wits, and they are bringing wads of money.”

A crypto machine allows a person to purchase digital currency by putting cash into the device, and then the funds are transferred to someone’s account.

Chief Mueller described some of the scams the department has investigated: “Individuals that are told that their loved ones are being hurt, arrested… or the federal or local government has warrants out for their arrests.”

The scammers tell the person to go to a machine, put in cash and then send the cryptocurrency to settle the issue, according to police.

In a recent letter to Stillwater’s mayor and City Council, Chief Mueller wrote that since 2023, Stillwater police have taken more than 30 crypto-related scam reports — totaling $156,442 of loss — and $73,092 of that had been deposited into various crypto ATMs in the city.

One example Mueller wrote about included a woman who received a phone call that she had received an overpayment into an account that she held.

Stillwater police said the victim was told by the scam artist to deposit $20,000 cash into an Athena Bitcoin ATM located inside the Amoco Gas Station downtown.

“Thankfully, we had a very alert clerk at that particular gas station and they called 911,” said Detective Sgt. David Wulfing, with Stillwater police. Officers arrived and were able to stop her from putting more of her money into the machine.

Detectives were able to get some of the victim’s money back.

The gas station owner told 5 EYEWITNESS NEWS that he trains staff if they see someone with a lot of cash at the crypto machine, to speak up and ask questions, adding he “cares about his customers.”

The machine is operated by a separate company, which 5 EYEWITNESS NEWS reached out to for comment.

“The most difficult part of these cryptocurrency investigations is many of the perpetrators are outside of the United States,” said Wulfing. “It’s very difficult to get that money back once it’s deposited.”

Stillwater police said if residents receive emails or phone calls demanding they pay someone, their department is there to help determine if the message is real — just reach out at (651) 351-4900.

“Unfortunately, they prey on the more vulnerable folks, the elderly and the more trusting people,” Wulfing said.

The Minnesota Legislature passed a law last year that required cryptocurrency kiosks to be registered and offer some consumer protections.

According to the Minnesota Department of Commerce, 230 machines are licensed in the state.

Since August, state officials report that 40 consumers who reported losses related to fraud totaling $437,983 have been able to get back $29,894.