Bitcoin Depot, once the largest Bitcoin ATM operator in the US, filed for Chapter 11 bankruptcy protection on Monday and pulled its entire kiosk network offline.
The filing landed in the US Bankruptcy Court for the Southern District of Texas. Canadian entities will join the US proceedings, while other foreign units wind down under applicable foreign law.
Bitcoin Depot to Wind Down After Filing for Bankruptcy Protection in Texas
CEO Alex Holmes pointed to a regulatory shift that has turned hostile to Bitcoin ATM (BTM) operators. States have imposed transaction caps, tighter compliance rules, and outright bans in multiple jurisdictions.
“Operators have faced increasing litigation and regulatory enforcement. These developments have materially affected Bitcoin Depot’s business and financial position. Under these circumstances, the Company’s current business model is unsustainable,” he said.
Indiana became the first state to ban the kiosks in March, followed by Tennessee and Minnesota, according to AARP. Bitcoin Depot also faced lawsuits from attorneys general in Massachusetts and Iowa. Connecticut suspended its operating license in March.
Meanwhile, the Federal Bureau of Investigation (FBI) logged 13,460 crypto-kiosk fraud complaints in 2025, with reported losses of $389 million. That marked a 58% jump from the prior year.
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The bankruptcy filing follows the company’s recent disclosure that it could not submit its quarterly 10-Q report to regulators on time. Q1 2026 results came in dramatically weaker than the same period a year earlier.
Revenue fell $80.7 million, a 49.2% year-over-year decline, after transaction volumes shrank under the weight of regulatory impacts and the tightened compliance checks.
Gross profit collapsed 85.5% to $4.5 million from $31.2 million. Cash reserves fell from $65.6 million in December to $44.0 million by March, and the company accrued over $20 million in legal judgments during Q4 2025.
Bitcoin Depot’s collapse may indicate whether other major operators can survive similar pressures.
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