These Bitcoin ATMs Were Supposed to Be the Future of Finance. They Went Bankrupt Just a Decade Later.

Bitcoin Depot (BTM) was the largest Bitcoin (BTCUSD) ATM network in North America. These ATMs gained popularity quickly after they launched in the summer of 2016, but this popularity wasn't really for their functionality.

Rather, people wanted to get a feel of what they thought was the future. Plus, who doesn't like to try new things?

It has been a decade since then, and they're now bankrupt.

Bitcoin Depot filed for voluntary Chapter 11 on May 18 in the U.S. Bankruptcy Court for the Southern District of Texas. The company plans to go through similar proceedings for its assets in Canada.

The company took its entire network of more than 9,000 kiosks offline the same day and is winding the whole thing down and selling the assets. Management's own word for the business model is "unsustainable."

Why the Bitcoin ATM Business Died

Bitcoin Depot's ATMs (or BTMs for short) died mostly because you had a mix of lawsuits, regulatory scrutiny, and fraud, plus the reality that most people were buying Bitcoins online. You were meant to get cash, slide it into these ATMs, and voila! You just now turned your "untraceable" cash into "untraceable" Bitcoins, which you could then use to buy whatever you wanted without being tracked.

Unfortunately, that's too good to be true.

There are better, more discreet ways to get your cash converted into a cryptocurrency of your choice.

BTMs ran know-your-customer/anti-money laundering checks (KYC/AML) like a bank. Bitcoin Depot's KYC started with phone number verification, with ID required for amounts above $250. Moreover, Bitcoin itself is horrible for privacy. Your transactions can be tracked by anyone on the internet, and while they may not have a name attached to them, you're going to have to officially cash out somewhere. The people with the right tools will find it very easy to "unmask" you.

If these kiosks offered Monero, they may have been more useful, but probably would have been sued much earlier, too.

Crypto Was Never Meant to Be Like this

The whole aspect of transacting in cryptocurrencies is for it to be peer-to-peer. That method is still popular and probably the most under-the-radar way of doing things.

On the other hand, if you needed a BTM, you were either using it for a shady purpose or you were a hobbyist. The FBI says Americans lost over $388 million to crypto ATM scams in 2025, a 58% jump from 2024. The Internet Crime Complaint Center received more than 13,400 complaints about these crypto ATMs.

Scammers were directing the elderly to these kiosks to send them money through Bitcoin. These elderly individuals do not know how to send money through crypto online, and banking channels typically have safeguards, so these kiosks made it very easy for them to get scammed. You can have all the KYC checks in the world, but at the end of the day, these ATMs were identifying the scammed as they were putting in the money, which isn't much help.

What Happens to BTM Stock from Here

Before you go bottom fishing with this stock, it's worth looking into what the bankruptcy entails. There's simply no recovery thesis because the business isn't coming back. Regulators have slowly but surely caught up, and the environment will never be permissive enough for these BTMs to make a full comeback. You're going to need a miracle for BTM stock to recover meaningfully from here.

The one cohort that "wins" here is whoever sells the pop to someone else. I wouldn't buy the stock, as what will likely happen instead is that it is going to keep going towards zero. The market cap is now in the low millions since a Chapter 11 filing doesn't halt the stock. It keeps trading until the exchange formally suspends it, which here is May 26. So there's a brief, legal trading window on a company everyone knows is winding down.

I wouldn't touch it and move on to other speculative stocks in the market. AI and high-performance computing bets are doing great, especially those that used to be in the crypto mining business.