Bitcoin Depot Seeks Chapter 11 Protection, Shuts Down 9,000+ Bitcoin ATMs

Bitcoin Depot, North America's largest Bitcoin ATM operator, has filed for Chapter 11 bankruptcy protection and has shut down its entire network of more than 9,000 machines, CoinDesk reported. Chief Executive Officer Alex Holmes blamed the collapse of the publicly traded company on a tougher regulatory backdrop. In a statement, Holmes said the regulatory landscape for Bitcoin ATM operators has "changed significantly," leaving Bitcoin Depot's business model "no longer viable." He said states have introduced more stringent compliance requirements, including new transaction limits, and in some jurisdictions have imposed outright restrictions or bans on Bitcoin ATM (BTM) operations. He also pointed to increasing litigation and regulatory enforcement, saying the crackdown has materially harmed the company's business and financial condition. Holmes said the company pursued all available alternatives before seeking court protection. "After evaluating all alternatives, we decided to initiate this court-supervised process to facilitate an orderly winddown of operations and the sale of the company's assets," he said. Proceedings will be overseen by the U.S. Bankruptcy Court for the Southern District of Texas. The filing also covers matters involving Bitcoin Depot's Canadian entity, as the company expects to pursue separate restructuring proceedings in Canada. Pressure on the business had been building in the run-up to the filing. The company reported a 49.2% year-over-year revenue decline in the first quarter of 2026 and a net loss of $9.5 million, compared with a net profit of $12.2 million a year earlier. Bitcoin Depot's shares have fallen 79.48% over the past six months, as regulatory uncertainty weighed on investor sentiment. The situation worsened after a series of setbacks in 2026. The company changed leadership in March 2026, appointing Holmes as CEO shortly after its money transmission license was suspended. A month later, it disclosed a cyberattack on its IT systems that led to the theft of $3.7 million from its cryptocurrency wallets. Earlier this month, Bitcoin Depot's Canadian subsidiary faced mounting challenges as ATM revenue declined and regulatory scrutiny intensified. The company is also involved in ongoing litigation tied to a damages dispute totaling $18.5 million. Headwinds are not limited to Bitcoin Depot. The broader Bitcoin ATM industry is facing similar regulatory pressure, including state-level prohibitions. Tennessee has become the second state to ban Bitcoin ATMs, following Indiana in April. Canadian authorities have also floated proposals that would move in a similar direction.