Bitcoin Depot Inc. (NASDAQ: BTM), the largest Bitcoin ATM operator in North America, filed for Chapter 11 bankruptcy on May 18 in the U.S. Bankruptcy Court for the Southern District of Texas and took its roughly 9,000 kiosks offline the same day. The company listed assets and liabilities in the $10 million to $50 million range and said it will use the court-supervised process to wind down operations and sell what remains of the business. Canadian entities will follow under a parallel proceeding, and other non-U.S. units will close under local law.
A Bitcoin ATM, or BTM, is a physical kiosk that lets users exchange cash for cryptocurrency without an account at a centralized exchange.
Key takeaways
- Bitcoin Depot filed Chapter 11 in the Southern District of Texas on May 18 and pulled all 9,000 kiosks offline.
- Preliminary Q1 2026 revenue fell 49% year over year to $83.5 million, with a $9.5 million net loss.
- The company carried more than $20 million in legal judgments and absorbed a $3.7 million April cyberattack loss.
- Indiana, Tennessee, and Minnesota have banned crypto kiosks outright in 2026, with 30 states passing related laws.
Published: May 18, 2026 09:00 UTC
A regulatory squeeze the business model could not absorb
Bitcoin Depot ran the largest BTM network in the country, with kiosks placed inside convenience stores, gas stations, and supermarkets across the United States and Canada. The company went public via SPAC in 2023 and traded on Nasdaq under the ticker BTM. CEO Alex Holmes, the former chairman and CEO of MoneyGram, took over in April 2026 and inherited a business already cracking under pressure.
Preliminary numbers filed alongside the bankruptcy show why. Revenue for the three months ended March 31 was about $83.5 million, down 49% from the same quarter a year earlier. The company posted a $9.5 million net loss against a $12.2 million profit in the prior-year period. Legal judgments and pending litigation across multiple states topped $20 million, and an April cyberattack disclosed in a separate SEC filing wiped out another $3.7 million.
Holmes said in a statement that the company tightened identity checks and added fraud warnings on its machines, but the regulatory environment moved faster than the business could adapt. Tighter rules, transaction caps, and outright bans in some jurisdictions left the model “unsustainable” under existing economics, he said. The statement is on the Bitcoin Depot investor relations page.
States moved first, and fast
Crypto kiosks have become one of the most heavily targeted corners of the U.S. crypto industry over the past 18 months, driven by AARP-led campaigns and state attorney general investigations into elder-fraud cases. Indiana became the first state to ban Bitcoin ATMs outright in March 2026, after a bipartisan bill cleared the state senate unanimously and was signed by the governor on March 9. Tennessee and Minnesota followed within weeks. According to the American Bankers Association, 30 states have passed crypto kiosk laws this year, and dozens more have bills active.
The new rules typically cap daily transactions between $1,000 and $2,500, require fraud warning signage, force operators to be state-licensed money transmitters, and obligate refunds for victims of scams routed through the machines. California, where Bitcoin Depot operated heavily, holds a $1,000 daily limit. A federal bill, the Crypto ATM Fraud Prevention Act, is still pending in the Senate. Coverage by The Block noted the company faced active enforcement actions in at least four states heading into the filing.
What happens to customer balances and the kiosks
Bitcoin Depot operated almost entirely on cash-in transactions and did not hold material customer crypto balances on its own books, which limits the consumer-deposit exposure typical of crypto bankruptcies like FTX or Celsius. The bigger question is what happens to the kiosks themselves. About 9,000 machines are now idle, many sitting in third-party retail locations under lease arrangements that the bankruptcy court will need to address. Sale of the BTM fleet is on the table, but with state bans expanding, the resale market for crypto kiosks is thin.
Decrypt reported in April that the company had flagged going-concern risk in its 10-K, a warning that became the bankruptcy filing six weeks later. BTM stock closed at $0.41 on May 15, the last trading session before the filing, down from a 2023 SPAC reference price of $10.
What comes next
The court is expected to hear “first day” motions this week covering payroll, leases, and the wind-down framework. Holmes said the company will pursue a sale of remaining assets, including its operational software, BTM hardware inventory, and any state licenses that survive the Chapter 11 process. Competitors CoinFlip and RockItCoin, which together run several thousand kiosks, now face the same regulatory wall without Bitcoin Depot’s scale or balance sheet. The wind-down of the country’s largest operator is the clearest signal yet that the U.S. crypto-kiosk era as it has existed since 2014 is closing.
Frequently asked questions
Why did Bitcoin Depot file for Chapter 11?
Bitcoin Depot filed Chapter 11 on May 18 after state-level bans and transaction limits crushed revenue. Q1 2026 sales fell 49% year over year, the company posted a $9.5 million net loss, and litigation exposure topped $20 million. CEO Alex Holmes called the regulatory environment unsustainable for the current business model.
What happens to the 9,000 Bitcoin Depot ATMs?
All Bitcoin Depot kiosks were taken offline on May 18 when the Chapter 11 petition was filed. The court will oversee a wind-down and sale process for the hardware, software, and any state money-transmission licenses still active. With Indiana, Tennessee, and Minnesota having banned crypto kiosks outright, the resale value of the fleet is uncertain.
Are customer funds at risk?
Bitcoin Depot did not custody material customer crypto balances. Its kiosks executed cash-to-crypto transactions that settled to the user’s wallet, so unlike FTX or Celsius, there is no large pool of customer deposits trapped in the estate. Any pending transactions interrupted by the May 18 shutdown will be addressed through the court process.
