Cryptocurrencies,  Technology

Citing Regulation, Bitcoin Depot Files for Bankruptcy

Bitcoin ATM operator calls business model ‘unsustainable’

By  / May 18, 2026 /

Even as some competitors expand their bitcoin ATM operations, Bitcoin Depot, once the largest operator of bitcoin ATMs in North America, announced it is closing up shop.

Bitcoin Depot announced Monday that it was filing Chapter 11 bankruptcy in the Southern District of Texas and would begin an orderly wind-down of its business in the United States. It expects to begin similar proceedings in Canada and elsewhere around the world “in due course.”

Bitcoin ATMs, or BTMs, allow users to buy bitcoin directly for cash, bypassing the need for cryptocurrency exchanges, and the credit cards and bank accounts needed to use them.

Saying its business model has become “unsustainable,” Bitcoin Depot CEO Alex Holmes blamed states that “have imposed increasingly stringent compliance obligations, including new transaction limits, and in some jurisdictions, outright restrictions or bans on BTM operations,” in a release. “Operators have faced increasing litigation and regulatory enforcement.”

Tennessee is the most recent of the latter group, having joined Indiana in banning BTMs in April. “Virtual currency kiosks have become a gateway for scammers to exploit Tennesseans, especially our seniors, with little hope of recovering their money once it’s gone,” Tennessee House Speaker Cameron Sexton, a sponsor of the bill, said at the time.

Attorneys General in Massachusetts and Iowa are leading a high-profile lawsuit against Bitcoin Depot, alleging that it facilitated crypto scams.

Bitcoin Depot said its network of BTMs had already been taken offline.

Other BTM operators are more optimistic. Bitcoin Bancorp announced in April that it was expanding its business in Los Angeles as part of a strategy targeting the whole country. The month before that, the company had expanded its operations in Texas.

“California represents a natural next step for our licensed Bitcoin ATMs — delivering secure, compliant on-ramps to Bitcoin while capitalizing on one of the largest economic markets in the United States,” said Eric Noveshen, director of Bitcoin Bancorp, at the time.

 You May Also Like

Leo Jakobson, Modern Consensus editor-in-chief, is a New York-based journalist who has traveled the world writing about incentive travel. He has also covered consumer and employee engagement, small business, the East Coast side of the Internet boom and bust, and New York City crime, nightlife, and politics.