Bitcoin Depot, previously the world’s largest operator of cryptocurrency ATMs, filed for bankruptcy Sunday, within the newest blow to an business that has been suffering from allegations of facilitating tons of of hundreds of thousands of {dollars} of fraud yearly.
The corporate has taken its community — comprising some 9,700 kiosks — offline, CEO Alex Holmes mentioned in a statement on its web site, and can stop operations.
Holmes cited “more and more stringent compliance obligations, together with new transaction limits, and in some jurisdictions, outright restrictions or bans” on crypto ATMs which have made the corporate’s enterprise infeasible.
Native and state governments throughout america have tightened restrictions on the machines, which permit money to be exchanged for cryptocurrency at an automatic kiosk just like a financial institution ATM. Authorities have opened investigations into crypto ATM operators in response to considerations that the machines had change into a simple method for scammers to make the most of unsuspecting victims.
In 2025, shoppers reported to the FBI $389 million of losses to scams involving the machines, which can be utilized to shortly transfer victims’ funds abroad and past the attain of U.S. legislation enforcement.
As the most important operator of cryptocurrency kiosks, Bitcoin Depot got here below intense scrutiny from regulators and native governments throughout the U.S. for its failure to cease problematic transactions on its community. Over the previous six months, the state of Connecticut suspended Bitcoin Depot’s banking license for lapses in anti-money laundering controls; Missouri’s lawyer common opened an investigation into the agency and different crypto ATM corporations; and Nevada and Maine settled enforcement actions with the agency, requiring it to pay fines and adjust to state guidelines. Massachusetts’ lawyer common sued Bitcoin Depot, alleging most of its income was derived from crypto scams. The corporate has additionally confronted a lawsuit by the Iowa lawyer common’s workplace.
The actions have had a punishing impact on Bitcoin Depot, in line with paperwork it filed with the Securities and Alternate Fee earlier this month. The corporate’s quarterly income plummeted by practically 50% yr on yr within the three-month interval ended March, the filings mentioned, largely pushed by “state and municipal laws banning or proscribing Bitcoin ATMs, capping charges and limiting transaction sizes” alongside the corporate’s adoption of “more and more enhanced” compliance and anti-fraud measures like extra stringent “know your buyer” processes.
In February, the corporate introduced that it will require its prospects to confirm their id for all transactions, making it tougher for scammers to make the most of the machines.
The income drop comes as Bitcoin Depot has racked up hundreds of thousands of {dollars} in authorized charges, its bankruptcy filings present. The corporate faces a number of lawsuits associated to allegations that it didn’t take ample measures to stop its machines from getting used for scams. That’s along with an almost $19 million arbitration award in opposition to it in late 2025 associated to the enterprise dealings of a Canadian subsidiary.
A 2025 investigation by ICIJ and CNN discovered that at the least $1.5 million in rip-off transactions had handed by tons of of Bitcoin Depot machines put in in Circle Ok comfort shops. Bitcoin Depot paid Circle Ok hundreds of thousands of {dollars} in rental charges as a part of the partnership, whereas taking a lower of every transaction for itself.
Circle Ok administration was conscious of the issue, the investigation discovered, however continued its relationship with Bitcoin Depot anyway.
