Bitcoin Depot First-Day Filing: Kiosks Offline, $15.8M Debt, and a Wind-Down Sale of "Substantially All" Assets

Brandon Mintz

Founder, Bitcoin Depot

Bitcoin Depot has taken its entire network of approximately 9,700 Bitcoin ATMs offline and will sell substantially all of its assets through Chapter 11, according to the first-day declaration filed May 18, 2026 by Chief Restructuring Officer Thomas Studebaker in the U.S. Bankruptcy Court for the Southern District of Texas.

The declaration — filed in support of an emergency first-day hearing held May 19 — is the first detailed look inside the largest Bitcoin ATM operator's collapse. It confirms this is a liquidation, not a turnaround: kiosks are dark, U.S. employees received 60-day termination notices contemporaneously with the filing, and foreign subsidiaries in Canada, Australia, and elsewhere are being wound down in parallel through separate insolvency proceedings.

The Core Numbers From the Filing

Studebaker's declaration breaks down the capital structure with precision. The Silverview Credit Facility carries approximately $13.34 million in principal outstanding at a 17.00% interest rate, plus a $3.1 million exit fee and $198,784 in accrued interest. Equipment financing through VFS LLC ($1.47 million) and NFS Leasing ($960,000) brings total funded debt to roughly $15.77 million.

Unsecured exposure is materially larger: $10.97 million owed under Kiosk Profit-Share Agreements, $4.23 million under Floorspace Agreements, approximately $9 million in trade claims, and up to $20 million in potentially disputed litigation judgments — including a $18.5 million arbitration award won by Bitcoin Depot's longtime adversary Cash Cloud, Inc. against subsidiary BitAccess, Inc.

What Drove the Collapse, In Management's Own Words

The declaration is unusually candid about cause. Studebaker attributes the failure to a compounding cycle of compliance costs, regulatory restrictions, and the revenue impact of the company's own fraud-mitigation measures.

The filing identifies "lawsuits and investigations from 11 state agencies," a voluntary information request from the SEC, and an FTC investigation — all of which "generally allege that certain of the Company's operating platforms are being used by third parties to perpetuate fraud."

Leadership Churn: Five C-Suite Departures in Four Months

The declaration documents an extraordinary management exodus that preceded the bankruptcy:

The February resignations of the chief legal and chief compliance officers — both flagged in the declaration as compliance-driven — triggered an internal investigation by Goodwin Procter, commissioned by a special committee of independent directors. Goodwin presented "initial findings and recommendations" in April 2026. The declaration does not disclose the substance of those findings.

Notably, the company paid retention bonuses to "certain high-level key employees" on May 8 and May 15, 2026 — within days of the petition date — citing "high volume of management turnover and uncertainty regarding the Company's path forward."

The Sale Process: BitAccess, Kiosks, and a Litigation Trust

The Debtors plan to file "in the near-term" a motion for bidding and sale procedures to sell "all or substantially all of their assets." The declaration identifies discrete asset packages likely to attract buyers:

• The Kiosk network — historically 99.8% of revenue ($613.6 million in 2025).
• BitAccess — the BTM device and transaction processing software platform, which the company believes "may be valuable to certain third-party purchasers" either standalone or bundled with the kiosks.
• Kutt, Inc. — the peer-to-peer social betting platform acquired February 27, 2026 for $4.5 million, which remains operational.
• ReadyBucks — the small business advance platform launched March 10, 2026, now in wind-down (collecting on existing advances only, no new originations).

A separate Investigation Subcommittee, with independent director Ivona Smith as sole member, is empowered to investigate "claims against current or former officers, directors, insiders, or third parties." If viable claims exist, the Debtors expect to establish a litigation trust for creditors' benefit.

The declaration states the Debtors "expect to be able to pay all Court-allowed amounts outstanding under the Silverview Credit Facility in full" — meaning Silverview, the 17% secured lender, is positioned for full recovery. Unsecured creditors face a far more uncertain outcome.

The Cash Cloud Irony

Buried in the litigation summary is a fact worth pausing on: Bitcoin Depot grew its kiosk count substantially in 2023 by acquiring assets from Cash Cloud, Inc. (operator of "Coin Cloud") out of Cash Cloud's own Chapter 11 bankruptcy. Cash Cloud subsequently won an approximately $18.5 million arbitration award against Bitcoin Depot subsidiary BitAccess for breach of contract and product defects. That award is now one of the largest unsecured claims against the bankrupt successor that absorbed Cash Cloud's footprint.

What This Means for Bitcoin Depot Customers

What This Means for Operators

Bitcoin Depot's filing is the clearest case study to date of how the regulatory environment translates to a P&L. The declaration explicitly cites three forces — state fee caps, transaction size limits, and the operator's own enhanced KYC — as the proximate causes of a 49.2% YoY revenue decline. Every operator faces some version of this trade-off.

Specific operator takeaways from the filing:

• KYC at every transaction is revenue-negative in the short term. Bitcoin Depot disclosed that its compliance bans alone represented ~4% of monthly transaction volume — before considering customers who self-deselect when asked for ID at low-dollar transactions.
• Compliance officer resignations are a leading indicator. The CCO and CLO walked four months before the bankruptcy, citing compliance concerns. Boards should treat such resignations as material disclosures.
• Floorspace and profit-share counterparties bear the credit risk. The Debtors hold approximately 7,700 Floorspace Agreements; those host retailers and the dozen-plus Kiosk Profit-Share counterparties ($10.97M in claims) are now unsecured creditors.
• Foreign expansion did not provide a regulatory hedge. Bitcoin Depot's Mexico and Brazil expansion efforts are being wound down alongside the U.S. business; Australia is in a separate insolvency proceeding.
• The 17% secured lender survives. Silverview's structure — first-priority lien on substantially all assets, 17% coupon, $3.1M exit fee — is positioned for par recovery, illustrating how high-cost secured debt extracts value before unsecured creditors and equity holders.

Operator trust scores and current enforcement exposure for the remaining U.S. operators are tracked in our operators directory.

What to Watch Next

The next material filings will be the bidding procedures motion and the schedule of assets and liabilities — both expected within days to weeks. The identity of stalking-horse bidders for the Kiosk network and BitAccess will signal whether a strategic operator believes a North American BTM business can be profitably revived under different ownership and a different compliance posture, or whether the assets sell only for scrap and software value. With Bitcoin Depot, Athena Bitcoin reporting collapsing revenue, and state-level bans spreading from Indiana to Tennessee, the question is no longer whether the U.S. Bitcoin ATM industry contracts — it's how far.