Bitcoin Depot Faces Shutdown in Connecticut Over Fees

• Connecticut halts Bitcoin Depot operations over fee violations and compliance gaps.
• Regulators cite overcharges, weak disclosures, and incomplete fraud refunds.
• Filing flags internal control weaknesses amid revenue decline and net loss.

Connecticut regulators have suspended Bitcoin Depot’s money transmission license, forcing the company to halt its Bitcoin ATM operations across the state following allegations of excessive fees, inadequate disclosures, and failures to refund fraud victims. 

The action prevents the firm from legally operating its kiosks in Connecticut and requires an immediate shutdown of affected machines, marking a big regulatory intervention in the Bitcoin ATM sector.

State authorities said their decision was based on findings that Bitcoin Depot exceeded Connecticut’s 15% fee cap on certain transactions. According to regulators, more than 1,000 transactions involved fees above the legal limit, resulting in approximately $150,000 in excess charges paid by over 500 users.

In addition, officials reported that some victims of scams involving Bitcoin Depot kiosks did not receive full refunds. The state also identified deficiencies in required disclosures and broader compliance controls governing kiosk operations.

The order emphasized that the suspension was necessary to protect “public safety and welfare,” and it seeks restitution, disgorgement, and potential civil penalties. Authorities also indicated that the company’s license could be revoked or not renewed depending on the outcome of the case.

A money transmission license is required for firms like Bitcoin Depot to legally operate money transfer services within a state. Without it, the company cannot continue its kiosk-based transactions in Connecticut.

Internal Control Weaknesses and Financial Pressures

Separately, Bitcoin Depot disclosed in a late filing notice to the U.S. Securities and Exchange Commission that it expects to report unremediated “material weaknesses” in its internal controls when it submits its annual report.

The regulatory developments come alongside mixed financial performance. Bitcoin Depot reported full-year revenue of approximately $615 million in 2025, up from approximately $575 million in 2024. However, the most recent quarter showed a decline, with revenue falling to about $116 million from roughly $137 million year-over-year.

The company also posted a net loss of approximately $25 million during the quarter. According to CEO Scott Buchanan, the downturn was “primarily driven” by recently introduced state regulations, including transaction size limits, as well as enhancements to compliance standards that affected transaction activity.

Founded in 2016, Bitcoin Depot became the largest Bitcoin ATM operator in North America and went public in 2023. Observers have noted that Connecticut’s action may signal increased regulatory scrutiny for the broader Bitcoin ATM industry.

Related: Bitcoin Depot Implements New Policy that Requires ID Verification for Every Transaction