Bitcoin ATM Operator Files for Bankruptcy After State Regulations

Bitcoin Depot, an Atlanta-based company that operated roughly 9,700 Bitcoin ATMs, filed for Chapter 11 bankruptcy in the Southern District of Texas. The company said it will begin winding down operations and selling off assets. The firm had reduced its California operations to fewer than 200 kiosks by the second quarter of 2025.

It had installed 200 machines in the state in 2020 and was once the largest Bitcoin ATM operator there.

SB401 law, which took effect in January 2024, limited Bitcoin ATM purchases to $1,000 per day. Bitcoin Depot stated that California was the only state with this daily purchase limit. The company directed customers seeking larger purchases to its BDCheckout and online options. Bitcoin Depot said the California limit contributed to a 25% drop in revenue in the third quarter of 2024.

5 million the prior year. 3 million in net income for that quarter and operated 8,300 machines at the end of September 2024. CEO Alex Holmes said the company had strengthened fraud protections but faced increasingly strict state rules on transaction limits and bans.

Holmes stated that the current business model is unsustainable under these circumstances. The bankruptcy filing listed assets and liabilities between $10 million and $50 million.