Bitcoin Depot has filed for Chapter 11 bankruptcy. The company operates a fleet of kiosks at retail locations that allow customers to purchase bitcoin with cash. Bitcoin Depot announced in a press release that its 9,700 kiosks – primarily located at gas stations and convenience stores – had already been taken offline.The company's bankruptcy filing reports between $10 million and $50 million in both assets and liabilities. In a recent financial disclosure, the company had reported a 49% year-over-year reduction in revenue and a net loss of $9.5 million for the year. The company had also suffered a $3.67 million hack in April.
Bitcoin Depot has blamed a challenging state-level regulatory environment for its bankruptcy, pointing to a series of regulatory restrictions and outright bans on crypto ATMs, which are a major conduit for crypto scams. An FBI report on Internet crime in 2024 showed 11,000 reports of fraud involving crypto ATMs – a 99% increase from the prior year. Almost $250 million was reported lost due to such scams, with a majority of it coming from victims over 60 years old. Several states have responded by introducing laws imposing strict compliance requirements or transaction limits on ATM operators, and Indiana and Tennessee have both recently banned the kiosks entirely. Additionally, the company is defending against lawsuits from both Massachusetts and Iowa, which argue that the company uses a misleading pricing structure, knowingly enables crypto scames, and maintains a predatory refund policy.
