Bitcoin Depot Flashes Bankruptcy Warning as ATM Revenue Falls, Regulatory Scrutiny Grows

Bitcoin Depot issued a “going concern” warning on Tuesday, flagging substantial doubt over whether the world’s largest crypto ATM operator can survive the next 12 months.

Founded a decade ago, the crypto kiosk giant is currently battling a wave of lawsuits from state regulators over its alleged failure to protect consumers from scams, indicating in an SEC filing that mounting legal costs and regulatory hurdles could ultimately lead to insolvency.

In the notice, Bitcoin Depot stated that it needs additional time to finalize its formal financial statements for the first quarter of 2026, attributing the delay to ongoing efforts to resolve an internal accounting weakness that stemmed from “cash in transit.”

Decrypt has reached out to Bitcoin Depot for comment.

In preliminary financial results, Bitcoin Depot reported a 49% year-over-year drop in revenue, generating roughly $83.5 million in the three months ended March 31. The firm cited a decrease in transaction volume prompted by shifts in regulation and enhanced compliance controls.

The company also attributed surging operating expenses to increased litigation costs, contributing to a net loss of $9.5 million compared to a profit of $12.2 million a year ago. Arguing that it has adequate measures in place to protect customers, the company is currently fighting high-profile lawsuits spearheaded by attorneys general in Massachusetts and Iowa.

Months ago, Bitcoin Depot indicated that it would begin requiring personal IDs for each transaction at its kiosks, voluntarily refining its compliance controls.

The states’ primary arguments include claims that Bitcoin Depot’s pricing is misleading, that the firm is knowingly facilitating crypto scams, and that its refund policy is predatory. Although local authorities have turned to brute force while attempting to retrieve funds for victims, an Iowa Supreme Court decision ruled last year that the company was entitled to keep deposited cash.

During the first quarter, the company’s cash and cash equivalents saw a $21.6 million drawdown. That left the company, which enables people to exchange cash for crypto, with $44 million. Bitcoin Depot noted its latest performance hasn’t been reviewed or audited.

Bitcoin Depot’s shares rose nearly 3% to $2.86 on Friday, according to Yahoo Finance, after showing an earlier loss as dipping as low as $2.56. Amid intensifying scrutiny over how crypto ATMs serve as a conduit for fraud—and tightening rules in several states—the company’s stock price has plummeted by 80% over the past year.

U.S. authorities have warned that older Americans have been especially susceptible to an uptick in scams involving crypto ATMs, where bad actors convince victims to deposit cash in the machines before disappearing with funds that are sent to them in digital form.

In August, Bitcoin Depot said it operated 9,000 kiosk locations globally. Last month, the firm disclosed that hackers had stolen 50.9 Bitcoin currently worth nearly $4 million from the company via a security breach that allowed attackers to gain access to crypto accounts and siphon funds.

Last year, fraud involving crypto ATMs reached a record high, with $389 million in reported losses, according to numbers released last month by the FBI’s Internet Crime Complaint Center. The figure represented a 58% increase in losses from 2024.