Bitcoin Depot, once the largest operator of crypto ATMs in North America, filed for bankruptcy on Monday, marking the latest major blow for a niche segment of the digital asset industry that has been in decline for several years.
Calling its business model “unsustainable,” Bitcoin Depot CEO Alex Holmes said the company would begin selling assets and winding down operations. It has already taken its network of thousands of “BTMs” that buy, sell, send, and receive Bitcoin offline.
Founded in 2016, Bitcoin Depot leapt onto a wave of crypto popularity among individuals, some of whom were attracted to the idea of taking cash and putting it into digital assets through an ATM. However, the company has been in trouble for some time.
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It never really recovered from a downturn that kicked off after the collapse of crypto exchange FTX in 2022. A regulatory crackdown that followed affected ATM operators, including some states banning them altogether, due to worries about the cash-friendly kiosks being used for illicit behavior. Holmes cited “increasing litigation and regulatory enforcement” as the main factors in Bitcoin Depot’s decision to file for Chapter 11.
A short-lived renaissance for crypto prices under the second Trump administration was not enough to persuade individuals to flock to the Bitcoin ATMs located at gas stations, convenience stores and nightlife venues where they proliferated. Then, another crypto winter began in October — with Bitcoin prices still down some 40% from an all-time high — making the idea of crypto investing even less attractive to individuals.
Bitcoin Depot filed for bankruptcy protection in the Southern District of Texas, according to its statement on Monday. Its Canadian entities are included in the US court-supervised process.
Other Bitcoin ATM providers include CoinFlip, Athena Bitcoin, Bitstop and RockItCoin, according to CoinATM Radar, which tracks the sector.
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