Bitcoin Depot (BTM) stock crashed in early trading Monday, falling nearly 74%, after the crypto ATM operator filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of Texas. The company also shut down its entire Bitcoin ATM network as it prepares to wind down operations and sell its assets.
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As part of the process, the company has already taken its Bitcoin ATMs offline. Bitcoin Depot also said its Canadian business will join the U.S. court-supervised process, while other international operations will be shut down under local laws.
Rising Costs and Regulations Hurt the Business
The company blamed stricter regulations, higher compliance costs, transaction limits, and growing legal pressure for the collapse of its business model.
CEO Alex Holmes said Bitcoin Depot had introduced stronger fraud controls over time, including stricter identity checks, lower transaction limits, and fraud warnings for customers. However, the company said rising regulatory pressure and lawsuits continued to hurt its financial position.
Holmes added that under the current environment, the company’s business model had become “unsustainable.”
Trouble Had Been Growing for Bitcoin Depot
The bankruptcy filing marks another major setback in a weak start to 2026 for Bitcoin Depot, with the stock already down more than 65% year-to-date before Monday’s sharp sell-off.
The first major warning came on May 12, when the company said it could not file its quarterly report on time due to accounting issues. At the same time, Bitcoin Depot released weak preliminary Q1 2026 results, showing revenue fell 49.2% year-over-year to $80.7 million. Gross profit dropped 85.5% to just $4.5 million, while Bitcoin Depot swung from a $12.2 million profit a year ago to a $9.5 million net loss.
Following the update, Noble Capital analyst Michael Kupinski downgraded the stock from Outperform to Market Perform. Along with ongoing legal issues and rising pressure on the business, Bitcoin Depot eventually decided to file for Chapter 11 bankruptcy protection.
What Is the Price Target for BTM Stock?
On TipRanks, Bitcoin Depot stock has a Moderate Buy consensus rating based on one Buy and two Holds. The average BTM price target of $4.10 implies nearly 39.93% upside potential from current levels.
