Bitcoin Depot's Booming First Quarter
Bitcoin ATM operator's shares surge following Q1 revenue boost of 19%
In a flourishing turn of events, Bitcoin ATM operator Bitcoin Depot reported an impressive first-quarter profit of $12.2 million, a marked improvement from a loss of $4.2 million in the same period the previous year.
The stock price soared 22% to $2.04 on Thursday following the financial reveal, although shares remain 79% down from their Nasdaq listing price in July 2023. Revenue for the company, which operates over 8,400 kiosks in North America, rose 19% year-over-year to $164.2 million, revealing the growth in kiosk deployment and a higher median transaction size.
Bitcoin Depot's treasury strategy involves holding $7.8 million worth of Bitcoin, a significant increase from the $600,000 held in the previous quarter. This surge is due to a shift to fair value accounting, as the company has started purchasing Bitcoin with a portion of its cash reserves and carries an "insignificant amount of Ethereum."
The company strives to obtain a license to operate in the densely populated state of New York this year, with the potential for over 3,000 kiosks to be installed long-term.
"New York state is one of the largest untapped markets for Bitcoin ECMs," stated CEO Brandon Mintz. "We're in discussions with regulators and remain optimistic about obtaining a license to operate in the state in 2025."
Bitcoin Depot machines supply software for kiosks purchased from another company since inception in 2016. The firm claims to have facilitated around $3 billion worth of transaction volume, primarily through machines in gas stations, convenience stores, and other retail locations.
Since the company's stocks were listed on the Nasdaq in July 2023, Bitcoin Depot's stock price has plummeted 79%, according to Yahoo Finance, amounting to a market capitalization of $44 million.
The firm's strong first-quarter performance rebounded from the previous quarter, where a decline in revenue was due to the negative impact of a law passed in California imposing daily transaction limits.
Currently, Bitcoin is trading around $103,000, a slight 0.4% decrease over the past 24 hours, as reported by crypto data provider CoinGecko. During the first quarter, the asset's price dipped as low as $78,800.
Amid rising concerns over fraud, particularly targeting elderly Americans, U.S. Senate Majority Whip Dick Durbin (D-IL) has emphasized the need for Bitcoin ATM operators to enforce tighter security measures. In response, Durbin proposed the Crypto ATM Fraud Prevention Act, which seeks to impose restrictions on large transactions and provide safeguards against fraud.
Other measures being debated include setting daily transaction limits, implementing full refunds for reported fraudulent transactions within 30 days, and mandating multilingual warnings on Bitcoin ATMs. While these regulations vary by state, there is an ongoing effort to regulate Bitcoin ATMs and protect vulnerable populations from scams.
- Bitcoin Depot, which operates over 8,400 kiosks, holds a significant amount of Bitcoin in its treasury, buying a portion of its cash reserves and carrying an "insignificant amount of Ethereum."
- The company's stock price soared after reporting an impressive first-quarter profit, but it remains 79% down from its Nasdaq listing price in July 2023.
- Bitcoin Depot's machines have facilitated around $3 billion worth of transaction volume, primarily in gas stations, convenience stores, and retail locations.
- Amid rising concerns over fraud, particularly targeting elderly Americans, US Senate Majority Whip Dick Durbin has proposed the Crypto ATM Fraud Prevention Act, which seeks to impose restrictions on large transactions and provide safeguards against fraud.
- Other digital currencies, like Ethereum, are also being used by Bitcoin Depot, albeit in insignificant amounts compared to Bitcoin.
