Coinme earns an F rating driven by the severity and breadth of its regulatory exposure across four jurisdictions and two federal agencies. The Washington State DFI's December 2025 cease-and-desist—citing $8.37 million in unredeemed customer vouchers booked as revenue and seeking a 10-year industry ban for CEO Neil Bergquist—represents the most serious enforcement action against any voucher-based crypto service. This follows the SEC's 2023 UpToken securities fraud settlement ($3.92M penalty, 3-year officer/director bar), Connecticut's 2024 license suspension for net worth failures dating to 2022, and California DFPI fining Coinme twice in seven months for the same category of violations. The pending Polygon Labs acquisition ($250M+) adds uncertainty about operational continuity.
Company Overview
How the Coinme Voucher System Works
Unlike direct-settlement Bitcoin ATMs that deliver cryptocurrency during the same visit, Coinme uses a multi-step voucher system that requires customers to complete the transaction online after leaving the kiosk.
- Visit a Coinstar kiosk at a participating grocery store (Safeway, Albertsons, Kroger, etc.) or a MoneyGram location
- Select cryptocurrency purchase on the touchscreen and insert cash bills
- Receive a paper voucher printed on the receipt with a redemption code
- Go home and open a web browser or download the Coinme mobile app
- Create a Coinme account (if you don't already have one)
- Complete identity verification (KYC) with photo ID and personal information
- Enter the voucher code to claim the cryptocurrency purchase
- Wait for delivery of the cryptocurrency to your designated wallet
The process splits a single transaction into two phases: a cash deposit at the kiosk and a separate online redemption. If a customer loses the paper voucher, fails to create an account, or doesn't complete the online steps, their cash remains with Coinme indefinitely. Washington State regulators found $8.37 million in such unredeemed voucher funds were booked as Coinme revenue rather than customer liabilities.
Coinme vs. Direct-Settlement Bitcoin ATMs
| Feature | Coinme Voucher Kiosk | Direct-Settlement Bitcoin ATM |
|---|---|---|
| Settlement | Delayed (hours to days) | Immediate (minutes) |
| Steps required | 7–8 steps across kiosk + online | 3–4 steps at one machine |
| Internet required | Yes (for redemption) | No (machine handles it) |
| Account required | Yes (online account + KYC) | Varies by operator and amount |
| Custody of funds | Operator holds cash until redemption | No custody gap |
| Hardware | Coinstar coin-counting kiosk | Purpose-built Bitcoin ATM |
| Sell (cash out) | Not available at kiosk | Available on two-way models |
Fee Structure
Coinme's fees vary by purchase channel. The total effective cost to the customer can exceed 16% at Coinstar kiosks, comparable to or higher than many traditional Bitcoin ATMs.
| Channel | Fees | Effective Total |
|---|---|---|
| Coinstar Kiosk | 4% transaction fee + 12.5% cash exchange fee | ~16.5% |
| MoneyGram | 4% cash convenience fee + $2.75–$5.75 flat fee | ~4%+ flat |
| Coinme Cash (retail) | 5% cash exchange fee + $2.95–$4.74 retail service fee | ~5%+ flat |
| Debit Card | 1.49% exchange fee + 3.25% CC processing fee | ~4.7% |
| ATM Cash-out (sell) | 1.49% exchange fee + 0.5% spread + $2.50 flat fee | ~2%+ flat |
Consumer Complaints
Coinme has accumulated a significant volume of consumer complaints across multiple review platforms. Common themes include unredeemed vouchers, funds not appearing in wallets, account lockouts, and difficulty reaching customer support.
Enforcement History
Coinme has faced five enforcement actions across four jurisdictions since 2023, resulting in combined penalties and restitution exceeding $13 million.
1. SEC UpToken Settlement (April 2023)
SEC Enforcement Action Resolved
The U.S. Securities and Exchange Commission settled charges against Coinme, its subsidiary Up Global SEZC, and CEO Neil Bergquist for conducting an unregistered securities offering through "UpToken," a cryptocurrency token. The SEC found that the entities raised approximately $3.5 million from investors between October and December 2017 without registering the securities as required by federal law. The SEC also cited an internal email from Bergquist telling potential investors that $4 million had been raised—when only $2.7 million had been collected—to create "Fear of Missing Out."
Penalties ($3.92 million total):
- Up Global SEZC (subsidiary): $3.52 million (disgorgement, prejudgment interest, and civil penalty)
- Coinme, Inc.: $250,000 civil penalty
- Neil Bergquist (CEO): $150,000 civil penalty plus 3-year bar from serving as officer or director of any public company
2. Connecticut Summary Suspension (October 2024)
Connecticut Banking Commissioner Resolved
The Connecticut Banking Commissioner issued a summary suspension of Coinme's money transmission license—the state's most severe administrative action short of revocation.
Violations cited:
- Failed to maintain $1 million minimum tangible net worth since at least July 2022
- Failed to have proper AML/KYC policies at kiosks
- Consumer complaints about scammers directing victims to Coinme kiosks
Penalties sought: License revocation, civil penalty, disgorgement, and restitution.
Resolved via Consent Order in 2025.
3. California DFPI First Consent Order (June 2025)
California DFPI Enforcement Action Resolved
The California Department of Financial Protection and Innovation (DFPI) issued a consent order against Coinme—the first enforcement action under California's Digital Financial Assets Law (DFAL). State examiners found that Coinme had accepted transactions exceeding the $1,000-per-customer-per-day limit and issued over 4,050 receipts missing required disclosures.
Penalties and restitution:
- $300,000 administrative fine (including $51,700 in restitution to California residents)
- 60-day compliance reporting for one year
4. Washington State DFI Cease-and-Desist (December 2025)
Washington DFI Enforcement Action Pending
The Washington State Department of Financial Institutions (DFI) issued a Temporary Order to Cease and Desist plus a Statement of Charges after examiners found approximately $8.37 million in unredeemed customer vouchers that the company had booked as revenue rather than customer liabilities—$2.2 million from Washington customers in 2023 and $6.17 million from all customers in 2024.
When customers insert cash at Coinstar kiosks and receive vouchers but never redeem them online, those funds represent customer liabilities under money transmitter law. Washington regulators found Coinme was treating these unredeemed funds as company income.
Additional violations cited:
- Failed to maintain legally required tangible net worth (2020–2025)
- Filed inaccurate reports with the DFI
- Listed an inactive consumer support phone number on vouchers (June–October 2024)
- Failed to disclose voucher redemption timeframe to consumers
- Failed to return unclaimed customer property to Washington State as required by law
Penalties and orders sought:
- $300,000 administrative fine plus $375 investigation fee
- 10-year ban for Coinme and CEO Neil Bergquist from the money services industry
- Money transmitter license revocation
- Restitution of $8M+ to consumers
Coinme resumed operations on December 30, 2025 after submitting financial records to the DFI under a temporary consent order. The Statement of Charges and license revocation case remain open.
5. California DFPI Second Enforcement (February 2026)
California DFPI Enforcement Action Active
The DFPI found continued violations after the June 2025 consent order. State examiners identified 22,600+ transactions in California since January 1, 2025 where Coinme charged fees exceeding DFAL statutory limits ($5 or 15%, whichever is greater), plus 4,050+ receipts still missing customer names.
Penalties and restitution:
- $174,874 in restitution to overcharged California consumers
- $1,000,000 conditional administrative penalty (payable if Coinme fails to comply with order terms)
- Mandatory compliance reporting every 60 days for one year
This marks the second time California regulators have acted against Coinme in seven months for the same category of violations—overcharging customers and missing receipt disclosures.
Polygon Labs Acquisition
Pending Acquisition
In January 2026, Polygon Labs (the development company behind the Polygon blockchain) announced an agreement to acquire Coinme and Sequence for a reported $250 million or more. The deal was expected to close in Q2 2026. The Washington State DFI enforcement action—including the pending Statement of Charges seeking license revocation and a 10-year industry ban for CEO Bergquist—remains unresolved and may affect the acquisition timeline or terms.
Zero Hash LLC and "CINQ by Coinstar"
California DFPI registration data lists Zero Hash LLC as one of the largest kiosk operators in the state by location count (~1,248 locations). Zero Hash is a cryptocurrency infrastructure company—not an ATM operator—that provides the settlement layer for a newer voucher product called "CINQ by Coinstar."
From the consumer's perspective, the CINQ experience is similar to Coinme: insert cash at a Coinstar kiosk, receive a voucher, and complete the cryptocurrency purchase online. Zero Hash processes the cryptocurrency settlement when the customer redeems the voucher through their platform.
Like Coinme, CINQ/Zero Hash kiosks do not appear in our Bitcoin ATM directory because they use the same voucher-based model with delayed settlement.
Why Coinme Kiosks Are Not in Our Directory
BitcoinATM.news lists only direct-settlement Bitcoin ATMs—machines that convert cash to cryptocurrency and deliver it to the customer's wallet during the same visit. Coinme's voucher kiosks are excluded because:
- They don't deliver cryptocurrency at the machine
- They require a separate online process to complete the transaction
- They use shared Coinstar hardware, not purpose-built Bitcoin ATM equipment
- The voucher model creates a custody gap that introduces risks absent from direct-settlement machines
We track Coinme and Zero Hash registration data from the California DFPI and other regulatory sources for analysis purposes, but these locations are excluded from our public map and location pages.
For a detailed comparison of voucher systems and direct-settlement Bitcoin ATMs, see our editorial analysis: Voucher Kiosks Are Not Bitcoin ATMs: Why Direct Settlement Matters.
Frequently Asked Questions
What is Coinme?
Coinme is a voucher-based cryptocurrency purchasing service founded in 2014 and headquartered in Seattle, Washington. Customers insert cash at Coinstar kiosks in grocery stores or MoneyGram locations and receive a paper voucher, which must then be redeemed online through the Coinme website or app to receive cryptocurrency. Coinme is not a Bitcoin ATM—it does not deliver cryptocurrency at the machine.
Is Coinme a Bitcoin ATM?
No. Coinme operates a voucher-based system, not a traditional Bitcoin ATM. Traditional Bitcoin ATMs convert cash to cryptocurrency and deliver it to the customer's wallet during the same visit. Coinme kiosks print a paper voucher that must be redeemed separately online, creating a multi-step process across multiple devices with a custody gap where the operator holds customer funds.
How does Coinme work?
Customers visit a Coinstar kiosk or MoneyGram location and insert cash. The kiosk prints a paper voucher with a redemption code. The customer must then go to coinme.com or the Coinme mobile app, create an account (with identity verification), and enter the voucher code to receive cryptocurrency in their Coinme wallet. The entire process requires two separate steps across different devices, unlike traditional Bitcoin ATMs where the transaction completes at the machine.
What fees does Coinme charge?
At Coinstar kiosks, Coinme charges approximately 16.5% total (4% transaction fee plus 12.5% cash exchange fee). At MoneyGram locations, fees include a 4% cash convenience fee plus a $2.75–$5.75 flat fee. Online debit card purchases cost approximately 4.7% (1.49% exchange fee plus 3.25% CC processing fee).
What enforcement actions has Coinme faced?
Coinme has faced five enforcement actions since 2023: (1) SEC settlement for UpToken securities fraud totaling $3.92 million in penalties, (2) Connecticut summary suspension of money transmitter license for failing net worth requirements, (3) California DFPI consent order with $300,000 fine for transaction limit violations, (4) Washington State DFI cease-and-desist for booking $8.37 million in unredeemed customer vouchers as revenue, and (5) California DFPI second enforcement for continued violations with $175,000 restitution order. The Washington case remains pending with license revocation and a 10-year ban for CEO Neil Bergquist still sought.
What is Coinme's trust score?
Coinme receives an F trust score (0 out of 100) on bitcoinatm.news. Deductions include: pending cease-and-desist in Washington State (-30), securities fraud via SEC UpToken settlement (-40), consumer fraud complaints (-20 across two categories), NMLS adverse actions in Connecticut and Washington (-20), and a danger-level warning (-25). A 10-point longevity bonus for operating since 2014 is insufficient to offset the total deductions.
Is Coinme in the Bitcoin ATM directory?
No. BitcoinATM.news lists only direct-settlement Bitcoin ATMs that deliver cryptocurrency during the same visit. Coinme's voucher kiosks are excluded because they use delayed settlement (requiring separate online redemption), operate on shared Coinstar hardware rather than purpose-built ATM equipment, and create a custody gap between cash deposit and cryptocurrency delivery.
Is Polygon Labs acquiring Coinme?
In January 2026, Polygon Labs announced an agreement to acquire Coinme and Sequence for $250 million or more, with the deal expected to close in Q2 2026. The pending Washington State DFI enforcement action—which seeks license revocation and a 10-year industry ban for CEO Bergquist—may affect the acquisition timeline or terms.