Sebastian Sinclair

The UK’s financial regulator has shut down dozens of crypto ATMs as part of its ongoing crackdown that includes an outright ban.



The Financial Conduct Authority (FCA) said in a statement it has ceased the operation of 26 machines after inspecting 34 locations.



In one instance, a Sheffield local paid thousands of pounds for crypto which never arrived, the FCA said.



&#8220;If you use a crypto ATM in the UK, you are using a machine that is operating illegally and you may be handing your money over to criminals,&#8221; said Steve Smart, joint executive director of enforcement and market oversight at the FCA, as reported by <a href="https://www.reuters.com/technology/uk-watchdog-shuts-more-illegal-cryptocurrency-machines-2023-07-10/?rpc=401&amp;" target="_blank" rel="noreferrer noopener">Reuters</a>.



In March last year, the regulator moved to <a href="https://blockworks.co/news/bitcoin-atms-illegal-in-the-uk-regulator-says" target="_blank" rel="noreferrer noopener">ban all crypto ATMs</a> across the UK, warning operators to “shut their machines down” or “face enforcement action.”



As a result of its prohibition, the number of bitcoin ATMs across the UK has fallen by more than 88% from 80 in March 2022 to just 10, <a href="https://coinatmradar.com/country/225/bitcoin-atm-united-kingdom/" target="_blank" rel="noreferrer noopener">Coin ATM Radar</a> shows.



The regulator has also called on crypto firms to abide by new advertising measures by October.&nbsp;



<a href="https://blockworks.co/news/crypto-uk-ads" target="_blank" rel="noreferrer noopener">Those rules</a> aim to govern how companies convey information regarding their crypto-related products across websites, applications and social media platforms, among other mediums.



Earlier this month, the UK took steps to <a href="https://blockworks.co/news/crypto-seizure-easier-uk" target="_blank" rel="noreferrer noopener">progress a bill</a> that seeks to simplify the process of confiscating digital assets for law enforcement and regulatory authorities.



If enacted, the law could empower officers to seize any hardware, software, physical items, or other objects that could aid in obtaining access to crypto.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: The newsletter that helps thousands of investors understand crypto and the markets, by Byron Gilliam.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Start your morning with the top news and analysis to inform your day in crypto.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: Reporting and analysis on the growing intersection of crypto and macroeconomics, policy and finance.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox. Market highlights, data, degen trade ideas, governance updates, token performance and more.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: Built for Solana investors, developers and community members. The latest from one of crypto&#8217;s hottest networks.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: For crypto collectors and traders, covering apps, games, memes and more.</li>
</ul>

UK down to 10 crypto ATMs after financial watchdog’s latest cull

Ben Strack

<div id="highlights-block_630f87177d7bd" class="highlights">
 <ul>
 <li>Crypto ATM operator’s transaction volumes are not correlated to bitcoin’s price, CEO says</li>
 <li>Bitcoin Depot seeks New York license, a state it thinks can support several thousand more machines</li>
 </ul>
 
</div>



The largest crypto ATM operator, which revealed its intent to go public last week, sees opportunities to acquire smaller players in the space and expand internationally following its planned listing on the Nasdaq.



Bitcoin Depot CEO Brandon Mintz told Blockworks he expects the public listing — via a pending combination with special purpose acquisition company GSR II Meteora Acquisition Corp. — could occur in the first quarter of next year.&nbsp;



Founded in 2016, the Atlanta-based company offers a way to convert cash into bitcoin, ether and litecoin via its roughly 7,000 ATMs in the US and Canada. &nbsp;



Bitcoin Depot’s transaction volumes have not historically been correlated to the price of crypto or seen significant impacts based on bull or bear market cycles, the executive added. It eclipsed an all-time high $160 million of transaction volumes during the second quarter of 2022, company data shows, despite the price of bitcoin plummeting to around $20,000.&nbsp;&nbsp;&nbsp;



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="591" src="https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Bitcoin-Depot-Transaction-Volumes-1024x591.jpg" alt="" class="wp-image-29725" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Bitcoin-Depot-Transaction-Volumes-1024x591.jpg?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Bitcoin-Depot-Transaction-Volumes-1024x591.jpg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Bitcoin-Depot-Transaction-Volumes-1024x591.jpg?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Bitcoin-Depot-Transaction-Volumes-1024x591.jpg?w=1536 1536w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Bitcoin-Depot-Transaction-Volumes-1024x591.jpg?w=2048 2048w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Bitcoin-Depot-Transaction-Volumes-1024x591.jpg?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Bitcoin-Depot-Transaction-Volumes-1024x591.jpg?w=453 453w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Bitcoin-Depot-Transaction-Volumes-1024x591.jpg?w=380 380w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Bitcoin-Depot-Transaction-Volumes-1024x591.jpg?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Bitcoin-Depot-Transaction-Volumes-1024x591.jpg?w=50 50w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /></figure>



The company has generated $623 million of revenue and $6 million of net income in the previous 12 months, as of June 30.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“Even if the [bitcoin] price drops 10% tomorrow, we don’t expect to see a lot of change,” Mintz said.</blockquote>



“We have grown consistently over time, so we think with that growth and the ability to elevate our profile, attract talent and acquire companies, it’s the perfect time to go public,” he added.



<h3 class="wp-block-heading">The crypto ATM landscape</h3>



There are 38,667 crypto ATMs in the world, according to <a href="https://coinatmradar.com" target="_blank" rel="noreferrer noopener">Coin ATM Radar</a>. Bitcoin Depot is the largest crypto ATM operator — accounting for roughly 18% of all crypto ATMs — followed by CoinCloud and CoinFlip, which have about 5,000 and 4,000 ATMs, respectively.&nbsp;



The top 10 operators run about 70% of the world’s crypto ATMs, though there are 257 operators in the US and 59 in Canada, Coin ATM Radar data indicates. The company plans to acquire some of the smaller players in North America, Mintz said.&nbsp;



“We think a lot of them would be interested in taking advantage of our economies of scale, our retail relationships, our hardware relationships and our strong management team to take them to the next level with us,” the CEO said.



The company launched <a href="https://bitcoindepot.com/bd-checkout/" target="_blank" rel="noreferrer noopener">BDCheckout</a> in June, allowing customers to load cash into their Bitcoin Depot digital wallet at more than 8,000 retail locations, where they can then purchase bitcoin. The news followed its partnership last year with gas station and convenience store chain Circle K.



<h3 class="wp-block-heading">Growth opportunities&nbsp;</h3>



After the US and Canada, which have 34,223 and 2,573 crypto ATMs, respectively, Spain’s 255 machines is third-highest.


<div class="wp-block-image">
<figure class="alignright size-full"><img loading="lazy" decoding="async" width="300" height="450" src="https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-31-Brandon-Mintz-CEO-of-Bitcoin-Depot.png" alt="" class="wp-image-29787" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-31-Brandon-Mintz-CEO-of-Bitcoin-Depot.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-31-Brandon-Mintz-CEO-of-Bitcoin-Depot.png?w=200 200w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-31-Brandon-Mintz-CEO-of-Bitcoin-Depot.png?w=171 171w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-31-Brandon-Mintz-CEO-of-Bitcoin-Depot.png?w=174 174w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-31-Brandon-Mintz-CEO-of-Bitcoin-Depot.png?w=146 146w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-31-Brandon-Mintz-CEO-of-Bitcoin-Depot.png?w=53 53w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-31-Brandon-Mintz-CEO-of-Bitcoin-Depot.png?w=33 33w" sizes="auto, (max-width: 300px) 100vw, 300px" /><figcaption>Brandon Mintz</figcaption></figure></div>


The drop-off represents a large opportunity to expand Bitcoin Depot’s footprint to other countries, Mintz said. The company is doing market research and has not yet committed to any specific regions.&nbsp;



In North America, Bitcoin Depot currently operates ATMs in 47 states and nine Canadian provinces. It is working with New York’s Department of Financial Services to get its BitLicense — the requirement for it to operate in the state.&nbsp;



Mintz said he hopes to receive the New York license in the next few months in order to expand to a state that is ripe for growth. New York has about 200 crypto ATMs, while Florida, which has a similar population, has more than 3,000.



Mintz said the recent bankruptcies of Voyager Digital and Celsius could spur investors to transact with crypto through Bitcoin Depot. He also pointed to Coinbase revealing in <a href="https://d18rn0p25nwr6d.cloudfront.net/CIK-0001679788/89c60d81-41a2-4a3c-86fb-b4067ab1016c.pdf" target="_blank" rel="noreferrer noopener">a May regulatory filing</a> that if the company ever declared bankruptcy, its customers could be treated as “general unsecured creditors.”&nbsp;



“I think there’s more and more focus on the phrase, ‘not your keys, not your coins,’” Mintz said. “So people are going to be looking more and more for unhosted, non-custodial wallets where they are not subject to any risk by a third party.”



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: The newsletter that helps thousands of investors understand crypto and the markets, by Byron Gilliam.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Start your morning with the top news and analysis to inform your day in crypto.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: Reporting and analysis on the growing intersection of crypto and macroeconomics, policy and finance.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox. Market highlights, data, degen trade ideas, governance updates, token performance and more.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: Built for Solana investors, developers and community members. The latest from one of crypto&#8217;s hottest networks.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: For crypto collectors and traders, covering apps, games, memes and more.</li>
</ul>

Largest Crypto ATM Operator Eyes Acquisitions, Global Expansion

Morgan Chittum

<div id="highlights-block_622b8988ee2b2" class="highlights">
 <ul>
 <li>There are 80 bitcoin ATMs or tellers in the UK, per data from Coin ATM Radar</li>
 <li>The FCA said “people should be prepared to lose all their money” if they invest in crypto assets because they are unregulated</li>
 </ul>
 
</div>



The Financial Conduct Authority (FCA) said on Friday that all crypto ATMs are prohibited from operating in the UK.



The regulator “warned” crypto ATM operators to “shut their machines down” or “face enforcement action,” according to a Friday <a href="https://www.fca.org.uk/news/news-stories/warning-illegal-crypto-atms-operating-uk" target="_blank" rel="noreferrer noopener">statement</a>.



<a href="https://coinatmradar.com/country/225/bitcoin-atm-united-kingdom/" target="_blank" rel="noreferrer noopener">Data from Coin ATM Radar</a> shows 80 bitcoin ATMs or tellers operate in the UK, none of which has been approved to offer crypto ATM services.



“We regularly warn consumers that crypto assets are unregulated and high-risk, which means people are very unlikely to have any protection if things go wrong, so people should be prepared to lose all their money if they choose to invest in them,” the FCA said in its announcement.



The news follows UK tax watchdog Her Majesty’s Revenue and Customs&#8217; confiscation <a href="https://cms.blockworks.co/uk-tax-watchdog-seizes-nfts-in-1-9m-fraud-investigation/" target="_blank" rel="noreferrer noopener">of three NFTs</a> last month in an almost $2 million fraud probe. 



Three people were arrested on suspicion of fraud as a result of the investigation. Suspects used virtual private networks (VPNs), stolen identities, fake addresses and unregistered phones to try to hide illegal activities.



This was the country&#8217;s first seizure of a blockchain-based digital collectible.



Nick Sharp, deputy director of economic crime at Her Majesty’s Revenue and Customs, <a href="https://www.bbc.com/news/business-60369879" target="_blank" rel="noreferrer noopener">told the BBC</a> that the authority is “constantly adapting to new technology to ensure [they] keep pace with how criminals and evaders look to conceal their assets.”



The use of bitcoin ATMs has come under increasing scrutiny elsewhere in the world as well. New licensing guidelines from the ​​Monetary Authority of Singapore (MAS) forced ATM operators there <a href="https://cms.blockworks.co/singapore-bitcoin-atms-shutting-down-following-central-banks-guidelines/" target="_blank" rel="noreferrer noopener">to shut down</a> in January.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: The newsletter that helps thousands of investors understand crypto and the markets, by Byron Gilliam.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Start your morning with the top news and analysis to inform your day in crypto.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: Reporting and analysis on the growing intersection of crypto and macroeconomics, policy and finance.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox. Market highlights, data, degen trade ideas, governance updates, token performance and more.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: Built for Solana investors, developers and community members. The latest from one of crypto&#8217;s hottest networks.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: For crypto collectors and traders, covering apps, games, memes and more.</li>
</ul>

crypto atm