In the 14 years since Bitcoin’s inception, a variety of related industries have rapidly emerged—from mining rigs and cryptocurrency exchanges to crypto lending platforms. However, as Bitcoin’s price experienced extreme volatility over the past year, these associated sectors also faced significant challenges, including operational difficulties and bankruptcies. One such industry is that of Bitcoin ATMs. With a history spanning nearly a decade, this once-thriving sector is now suffering severe setbacks due to the ripple effects of the crypto bear market.
Recently, Cash Cloud, one of the largest Bitcoin ATM operators in the United States and Brazil, filed for bankruptcy protection. This came just weeks after its primary financial backer, Genesis Global Capital—one of the world's major crypto lending firms—also declared bankruptcy.
According to legal documents, Cash Cloud’s liabilities are estimated between $100 million and $500 million, with assets ranging from $50 million to $100 million. The company has over 10,000 creditors and owes its two largest creditors a combined $116 million.
The Boom: Triple Revenue Streams
In 2013, RoboCoin deployed the world’s first public Bitcoin ATM in Vancouver, Canada. On its first day of operation, the machine served 81 users with a total transaction volume of $10,000. Within the first week, it processed 348 transactions totaling $100,000.
Bitcoin ATMs primarily allow users to exchange bitcoin (as well as other cryptocurrencies like Ethereum, Litecoin, and Dogecoin) for U.S. dollars—using cash, debit cards, or credit cards—and vice versa. When buying cryptocurrency with dollars, users typically pay a service fee ranging from 10% to 20%. The purchased crypto usually arrives in the user’s wallet within 3 to 5 minutes.
RoboCoin’s early Bitcoin ATMs retailed for around $20,000 each. They supported three verification methods: palm vein scanning, ID document scanning, and facial recognition. These machines were often placed in locations like coffee shops, gas stations, and grocery stores, with operators paying retailers a space-rental fee.
Beyond profits from machine sales and transaction fees, manufacturers also earned revenue through rental fees paid by crypto exchanges or digital wallet services.
As more players entered the market, RoboCoin’s market share gradually declined. By July 2015, the company held less than 6% of the global market. Over the next three years, the crypto ATM industry began to consolidate. In 2018, just two companies—Genesis Coin (based in the U.S.) and General Bytes (from the Czech Republic)—controlled over 60% of the global Bitcoin ATM market.
Over the past decade, the number of crypto ATMs continued to grow. By early August 2022, there were more than 39,000 machines installed worldwide. During this period, the global center of crypto ATM operations also shifted from Canada to the United States.
Market reports indicated that the cryptocurrency ATM market was expected to reach $144.5 million by 2023.
The Decline: Impact of the Bear Market
By the end of 2022, the 7-day moving average of cryptocurrency trading volume had fallen to $352.6 million—a nearly 50% drop from earlier levels and the lowest point in two years. Like many other crypto-related businesses, Bitcoin ATM usage and installation rates faced serious challenges during the bear market.
In September 2022, 459 crypto ATMs were removed from the global network. As the market value of Bitcoin and other cryptocurrencies shrunk significantly, the net number of active crypto ATMs worldwide declined. A similar slowdown had occurred in July 2018 when Bitcoin’s price plunged and bottomed out.
In recent years, Bitcoin ATMs expanded rapidly across cities and rural areas in the United States. According to CoinATMRadar, the U.S. was home to 34,000 crypto ATMs as of November 2022. But that period of growth is now over. With Cash Cloud—which supported approximately 7.9% of U.S. Bitcoin ATMs—filing for bankruptcy, nearly 2,700 machines went offline. The company’s website stated it operated over 5,000 ATMs supporting more than 40 cryptocurrencies.
The crypto downturn also reduced user demand for converting fiat to digital assets. Some reports noted that by December 2022, Bitcoin ATMs in central urban areas were being used less than once every two weeks. Machines in rural areas saw even lower activity. In some low-traffic locations, crypto ATMs operated at a loss—accumulating debt due to insufficient usage to cover rent, marketing, and labor costs.
Many operators slowed or halted the installation of new machines, focusing instead on relocating underused units to more profitable locations.
As predicted early in the year, the cryptocurrency market began rebounding at the start of 2023. Year-to-date, Bitcoin’s price increased by more than 40%, even briefly touching $24,000. Trading volumes also started recovering, rising at a weekly rate of around 11%.
Still, the market may need more time to fully absorb the negative impact of the 2022 crash. Beyond the high-profile bankruptcies, several other firms—including crypto lender Amber, U.S. exchange Coinbase, and Singapore-based Matrixport—announced layoffs in early 2023, with cuts ranging from 10% to 20% of their workforce.
Industry Shifts: Expansion and Regulation
Due to the large number of hardware and software providers and a favorable investment environment, North America continues to lead the global cryptocurrency ATM market.
Even with recent operator bankruptcies reducing the number of active machines, the U.S. maintains a dominant share of global crypto ATMs. Canada, notably, achieved a 28% increase in Bitcoin ATM installations during the 2022 market slump. Recent data shows that the U.S. and Canada together account for 94.4% of the world’s crypto ATMs.
Australia also experienced rapid growth in crypto ATM installations, recording the highest number of new machines globally. In less than a month early in the year, Australia surpassed both El Salvador and Spain to become the country with the third-most crypto ATMs—after the U.S. and Canada. Australia now hosts 0.6% of the world’s machines. At this pace, the country is positioned to lead Asian market expansion with 312 ATMs.
Beyond North America, Latin America, Europe, and Oceania, crypto ATMs are also gaining popularity in economically challenged European countries like Bosnia and Herzegovina. In regions with weak traditional financial systems, high inflation and limited banking access have led to higher cryptocurrency adoption.
At the same time, regulators in several of the 14 countries where cryptocurrency is legal have begun identifying financial risks associated with crypto ATMs.
The U.K.’s Financial Conduct Authority (FCA) recently announced it would take action against unregistered crypto ATM operators in Leeds, the country’s third-largest city. The crackdown could have broad implications since no crypto ATM operator is currently registered with the FCA—making all such machines illegal in the U.K. Due to a lack of anti-money laundering (KYC) protocols, the FCA had already ordered crypto ATM suppliers to cease operations in March of last year.
In early 2022, the FBI issued a warning about scams involving cryptocurrency ATMs, noting that fraudsters often use social engineering techniques to trick victims into making irreversible transactions. Earlier this year, the U.S. Federal Trade Commission (FTC) also alerted consumers to the rise in crypto ATM-related fraud.
Frequently Asked Questions
What is a Bitcoin ATM?
A Bitcoin ATM is a kiosk that allows users to buy or sell bitcoin and other cryptocurrencies using cash or debit cards. Unlike traditional ATMs, these machines often connect to online exchanges to facilitate crypto transactions.
How do Bitcoin ATMs make money?
Operators earn revenue through transaction fees (often between 10%–20%), machine manufacturing and sales, and sometimes rental agreements with exchanges or wallet services.
Why are Bitcoin ATMs declining in numbers?
The crypto bear market of 2022 reduced trading volumes and demand for conversion services. Many operators could not cover operational costs, leading to bankruptcies and machine removals.
Are Bitcoin ATMs regulated?
Regulation varies by country. Some nations, like the U.K., require registration and strict anti-money laundering checks. Others have yet to implement clear rules.
Can you buy other cryptocurrencies at these ATMs?
Many machines support alternative cryptocurrencies such as Ethereum, Litecoin, and Dogecoin. Operators often update supported assets based on demand.
What are the risks of using a Bitcoin ATM?
High fees and limited regulatory oversight can pose financial risks. Additionally, scammers sometimes use these machines for fraudulent schemes. Always verify the legitimacy of the operator before use.
For those interested in exploring real-time transaction tools, it is important to use reputable platforms and stay informed about regulatory changes. You can also discover updated market strategies to navigate the evolving crypto landscape.