Leading Global Bitcoin ATM Provider Coin Cloud Files For Bankruptcy
Some analysts are debating whether the crypto winter is over. But for Coin Cloud, the consequences were just too much to handle.
Coin Cloud, one of the largest Bitcoin ATM operators in the US and Brazil, filed for bankruptcy this January 8, leaving nearly $500 million in liabilities. The crypto winter and the collapse of major companies like FTX, Alameda Research, and Blockfi, among others, has left Coin Cloud suffering from its aftermath.
According to Coin Cloud’s filings, its largest creditor would be Genesis Global Trading, a subsidiary of Digital Currency Group, to whom the company owes more than $100 million for an uncollateralized loan. On the other hand, its second-largest creditor, Cole Kepro, is owed approximately $8.5 million, a far cry from the debt owed to Genesis. According to Coin Cloud, the company has between $50 million and $100 million in assets from about 10,000 creditors.
The Rise And Fall of Coin Cloud
In January 2022, Coin Cloud presented itself as the largest operator of digital currency machines in the US, having installed more than 1100 Bitcoin ATMs worldwide. The company was looking to expand its networks to major US retail chains, as the demand for Bitcoin ATMs had accelerated during the pandemic, far exceeding the company’s expectations.
Coin Cloud’s own statistics reveal that the company operates more than 5,000 ATMs distributed between the US and Brazil, supporting more than 40 cryptocurrencies, including Bitcoin, Ethereum, Litecoin, Bitcoin Cash, Dogecoin, and more. Additionally, the company offers bonuses of up to $25 in BTC for clients who purchase $150 in cryptocurrencies through any of their ATMs.
However, the growing cryptocurrency ATM industry suffered a sharp drop in mid-2022 due to the crypto winter and the price correction of Bitcoin (BTC), which lost about 70% of its value after reaching an all-time high of $69,000 in November 2021, as reported by Cryptopotato.
The Growing Bitcoin ATM Industry
The global cryptocurrency ATM industry remains an expanding sector in the crypto ecosystem despite the adversities faced by service providers during the recent bearish times.
According to CoinATMRadar data, there are 33,281 ATMs installed in the US, representing 86.8% of all Bitcoin ATMs in the world, followed by Canada with 2,554 ATMs, equivalent to 6.7% of the total number of ATMs worldwide.
Despite the challenges and the scary news announced by Coin Cloud, the demand for cryptocurrency ATMs continues to grow, with the industry remaining a prominent player in the crypto ecosystem. The number of crypto ATMs deployed globally is still relatively small compared to the number of fiat ATMs, surpassing the 3.2 million machines worldwide. This highlights the potential for growth in the cryptocurrency ATM industry.
Other crypto ATM companies have not reported any financial problems. In fact, recently, the crypto ATM provider BitStop revealed it acquired Genesis Coin to further expand its reach, now controlling over 31.9% of all crypto ATMs worldwide.