Bitcoin Depot warns it may not survive next 12 months

The Atlanta-based crypto ATM operator filed a going concern notice with the SEC after preliminary first-quarter results showed revenue fell 49% year over year to about $83.5 million for the quarter ended March 31. The company reported a $9.5 million net loss compared with a $12.2 million profit a year earlier. Transaction volumes declined amid new state regulations and tighter compliance controls.

The filing states the company needs more time to complete its formal first-quarter financial statements after identifying an internal accounting weakness tied to cash in transit. The preliminary financials have not been reviewed or audited.

The company disclosed a cybersecurity incident on March 23 in which attackers accessed IT systems, obtained credentials for settlement accounts and transferred approximately 50.9 Bitcoin, roughly $3.665 million at the time. Incident response protocols were activated after the breach was discovered.

Cash and cash equivalents fell by about $21.6 million during the quarter, leaving roughly $44 million on hand. The SEC filing flagged substantial doubt about the company’s ability to continue operations over the next 12 months.

Legal expenses increased as Bitcoin Depot faces consumer protection lawsuits brought by state attorneys general in Massachusetts and Iowa. The complaints allege misleading pricing, facilitation of scams and a predatory refund policy. Regulators have sought to recover funds for alleged victims; an Iowa Supreme Court ruling last year found the company could retain deposited cash in one dispute.

Management attributed higher operating costs to litigation and compliance upgrades and said those factors, along with regulatory changes, reduced transaction volumes and revenue. Investor notices warn of uncertainty about near-term liquidity and legal outcomes and do not include a detailed plan to raise additional capital.

Bitcoin Depot operates thousands of kiosks globally and previously reported about 9,000 locations. Its stock has fallen sharply over the past year and has traded at low single-digit prices in recent sessions. Industry reports show fraud involving crypto ATMs has risen and drawn increased scrutiny from state regulators and consumer protection officials.

Company filings indicate Bitcoin Depot is defending the lawsuits, working to resolve the accounting issue and responding to the security breach.