Author:Ben Dooley
Compiled by:Deep Chao TechFlow
Deep Chao Insight: Crypto ATMs, once ubiquitous in convenience stores across the United States, are now retreating en masse under regulatory pressure. The world's largest crypto ATM operator, Bitcoin Depot, filed for Chapter 11 bankruptcy protection on May 18th, with approximately 9,700 of its machines ceasing operations. The direct cause is a wave of state-level regulations, including transaction limits, license suspensions, and anti-fraud lawsuits—FBI data shows consumers lost $389 million through crypto ATM scams in 2025. This report from the ICIJ (International Consortium of Investigative Journalists) reviews the journey of this publicly traded company from expansion to collapse.
Caption: A police officer disconnecting the power to a Bitcoin Depot ATM inside a convenience store in Haverhill, Massachusetts, on April 6, 2026.
Image source: Jessica Rinaldi/The Boston Globe via Getty Images
Bitcoin Depot, once the world's largest cryptocurrency ATM operator, officially filed for bankruptcy protection on May 18th. This company, long accused of facilitating scams, delivered another blow to the industry.
CEO Alex Holmes stated in a declaration on the company's website that all approximately 9,700 crypto ATMs operated by the company have been taken offline and operations will cease.
Holmes attributed the failure to "increasingly stringent compliance requirements, including new transaction limits, and direct restrictions or bans on crypto ATMs in certain jurisdictions," which made the business model unsustainable.
Over the past year, local and state governments across the U.S. have significantly tightened regulations on crypto ATMs. These machines function similarly to bank ATMs but are used to exchange cash for cryptocurrency. Due to concerns that these machines are being used as tools for scams, regulators have launched investigations into operators.
FBI data shows that consumers lost $389 million through crypto ATM scams in 2025. Scammers use these machines to quickly transfer victims' funds overseas, beyond the reach of U.S. law enforcement.
Crackdown by Multiple States in Six Months, Quarterly Revenue Plunges Nearly 50%
As the largest crypto ATM operator, Bitcoin Depot became a prime target for regulators. How intensive was the crackdown in the past six months?
Connecticut revoked Bitcoin Depot's banking license for inadequate anti-money laundering controls; the Missouri Attorney General launched an investigation into the company and other crypto ATM businesses; Nevada and Maine reached enforcement settlements with the company, requiring fines and compliance with state rules. The Massachusetts Attorney General directly sued Bitcoin Depot, alleging that a significant portion of its revenue came from crypto scams. The Iowa Attorney General's office also filed a lawsuit.
The impact on financial reports is startling. A filing Bitcoin Depot submitted to the SEC earlier this month showed revenue for the quarter ending in March plummeted nearly 50% year-over-year. The primary reasons cited were "state and municipal regulations prohibiting or restricting crypto ATMs, capping fees, limiting transaction amounts," as well as the company's own, necessary implementation of "stricter" compliance and anti-fraud measures, such as enhanced KYC (Know Your Customer) processes.
In February of this year, the company announced that all transactions would require customer identity verification. This made it harder for scammers to use the machines but also drove away a large number of users.
Bogged Down in Lawsuits, Mounting Legal Fees
While revenue plummeted, Bitcoin Depot was also burdened with massive legal fees. Bankruptcy filings show the company faces multiple lawsuits all pointing to the same issue: failing to take sufficient measures to prevent scam transactions from occurring through its machines. Additionally, an arbitration ruling related to a business dispute with a Canadian subsidiary in late 2025 saddled the company with nearly $19 million in damages.
A joint investigation by ICIJ and CNN in 2025 found that at least $1.5 million in scam transactions were completed through hundreds of Bitcoin Depot machines installed inside Circle K convenience stores. Bitcoin Depot paid millions in leasing fees to Circle K while taking a cut from each transaction.
The investigation found that Circle K management was aware of the problem but continued its partnership with Bitcoin Depot.
