Despite the volatility of the cryptocurrency market, Bitcoin Depot, the largest ATM operator in the US, has maintained stable earnings that are not influenced by Bitcoin's price fluctuations. This resilience stems from customers primarily using ATMs for practical services such as money transfers and remittances rather than speculative trading.
Bitcoin Depot Proves Earnings Resilient Amidst Crypto Market Volatility
New York, NY, April 15, 2023 - Bitcoin Depot, the leading operator of Bitcoin automated teller machines (ATMs) in the United States, has reported that its financial performance remains unaffected by fluctuations in the cryptocurrency market. This insight was revealed in the company's annual report (Form 10-K) filed with the Securities and Exchange Commission on April 15, 2023.
According to the report, Bitcoin Depot generated $689 million in revenue in 2023, a slight increase from the $647 million it earned in 2022. Notably, the company's revenue stream has remained steady despite significant volatility in Bitcoin's price, which is the primary driver of performance for many cryptocurrency businesses.
Bitcoin Depot attributes this resilience to the fact that its customers primarily use ATMs for essential financial services such as money transfers, international remittances, and online payments, rather than for speculative trading or investment. The company has also implemented risk management strategies to mitigate the impact of Bitcoin price fluctuations.
"We maintain a relatively low Bitcoin balance of approximately $0.8 million, which does not materially appreciate over any period of time," the company stated in its annual report. "Our typical practice is to purchase Bitcoin through a liquidity provider such as Cumberland DRW or Abra. We replenish our Bitcoin only through purchases from leading Bitcoin liquidity providers and do not engage in any mining of Bitcoin ourselves."
Bitcoin Depot's working capital includes Bitcoin Hot Wallets, which are specifically allocated for fulfilling customer orders, and cash held in its Bitcoin ATM kiosks. As of December 31, 2023, monthly revenue from Bitcoin Hot Wallets accounted for approximately 21% of the company's total revenue.
Founded in 2016, Bitcoin Depot has established a robust network of Bitcoin ATMs worldwide, enabling users to conveniently deposit and withdraw funds using cash or debit cards. The company's CEO, Brandon Mintz, anticipates a surge in business activity as the cryptocurrency industry eagerly awaits the upcoming Bitcoin halving event.
"We believe that the Bitcoin halving will have a profound impact on the market, potentially triggering a significant increase in demand for Bitcoin ATMs," Mintz said. "Bitcoin Depot is well-positioned to capitalize on this opportunity with our extensive network and commitment to providing reliable and secure access to Bitcoin."
