Walk up to most Bitcoin ATMs with twenty dollars and a phone number is often all the machine asks for. Try to feed in a few hundred dollars more, and the same machine will suddenly want your driver’s license scanned and a photo of your face matched against it. The identity checks scale with the transaction, and each step up the ladder exists because of a specific legal obligation the operator is trying to satisfy, not because the machine is being cautious for its own sake.
The Phone Number Is the First Checkpoint
At the lowest tier, a Bitcoin ATM typically asks only for a mobile number. You get a text with a code, you type it in, and the transaction proceeds. This looks minimal, but it isn’t nothing. A phone number lets the operator tie a transaction to a real, reachable person and gives them a way to flag repeat activity from the same device or number across multiple visits. It’s the entry-level version of “know your customer,” built for transactions small enough that regulators don’t require more.
Operators commonly tier identity requirements by transaction size, starting with a phone number and escalating to government ID and a photo as the amount goes up. Exactly where each tier starts is not standardized nationally. Requirements vary by operator and by state, so the same twenty-dollar transaction that clears with just a phone number at one machine might trigger an ID scan at another, depending on that operator’s internal compliance policy and the money transmitter license it operates under in that state.
ID Scans Kick In as the Dollar Amount Rises
Push the transaction size higher and the machine will usually ask you to scan a government-issued ID, often a driver’s license or passport, directly against the camera or a built-in scanner. This is where the transaction stops being anonymous in any meaningful sense. The operator now has your legal name, date of birth, and document number attached to the exact amount of cash you fed into the machine and the wallet address it went to.
This step exists because Bitcoin ATM operators in the United States are money services businesses, which puts them under federal anti-money-laundering obligations. Those obligations require verifying who is actually making a transaction once it crosses a size where the risk of money laundering or fraud becomes harder to ignore. The ID scan is the operator building a paper trail that regulators can request later if a transaction turns out to be connected to something illegal.
The Selfie Is the Highest Tier, and the Most Revealing
At the top tier, some machines add a live photo, comparing your face in real time against the ID you just scanned. This is meant to stop someone from using a stolen or borrowed license to move a large sum through the machine under someone else’s name. It’s the closest a cash kiosk gets to the identity checks you’d go through opening a bank account.
Because Bitcoin transactions are irreversible once confirmed, this tier matters more than it would for a card payment. There’s no chargeback equivalent in Bitcoin. If a transaction later turns out to have been made under a false identity or as part of a scam, the operator can’t simply reverse it the way a bank can reverse a fraudulent card charge. The selfie and ID match are the operator’s best tool for making sure the person walking away from the machine is who they say they are, because once the coins move, that’s the end of it.
Why Operators Are Required to Do This at All
The legal foundation underneath all three tiers is the same. US Bitcoin ATM operators are money services businesses subject to federal anti-money-laundering obligations, and on top of that, money transmitter licensing is administered state by state. That second layer is why the checks you encounter at a machine in one state can look different from the checks at a machine in another. A company might run a lighter phone-verification process in a state with less demanding licensing terms, and a heavier ID-and-photo process in a state where its license requires more documentation per transaction.
None of this is optional for the operator. A machine that skipped identity checks entirely, regardless of transaction size, would be operating outside the terms of its money transmitter license and outside federal AML rules. The tiering system is the operator’s attempt to balance that legal requirement against the practical reality that most people using these machines are moving small, ordinary amounts of cash and don’t want to hand over a passport scan to buy forty dollars of Bitcoin. If you’re unfamiliar with terms like “money services business” or “know your customer,” the site glossary breaks down the terminology operators and regulators use.
What the ID Tiers Don’t Protect You From
Identity verification tells the operator who you are. It does nothing about what the transaction costs you or whether the machine will still be there next month. The Federal Reserve Bank of Kansas City reported in 2023 that the median fee for buying Bitcoin from a US Bitcoin ATM, self-reported by operators through Coin ATM Radar, is 16 percent of the transaction value, with a median sell fee of 15 percent. On top of that, exchange rate costs add an estimated 5 to 7 percent, meaning total fees of 20 percent may not be uncommon. For context, the same research estimated that the total cost of operating a Bitcoin ATM runs only 3 to 6 percent of revenue, which gives a sense of how wide the margin is between what it costs to run these machines and what customers are charged.
That 16 percent median is also probably lower than reality. It’s self-reported, and operators charging above-average rates commonly disable reporting altogether, so the published figure is biased toward the lower end of what people actually pay. The identity check you go through has nothing to do with this fee structure. You can pass every verification tier and still hand over a fifth of your cash in fees before a single coin reaches your wallet.
The machine’s continued existence isn’t guaranteed either. USA Crypto Reports verified 200 Bitcoin ATM listings and found that 41 of them, roughly one in five, no longer existed. Some of that instability comes from the top down: Bitcoin Depot filed for Chapter 11 bankruptcy in May 2026, and more than 9,000 of its machines were deactivated as a result. An ATM that asked for your ID and took your photo last month can simply be gone the next time you look for it.
Before you drive out to use a machine, check that it’s still active in our verified Bitcoin ATM directory, and if you find one that’s been shut down or relocated, let us know so we can update the listing.