Bitcoin Depot Hit With $18.5M Award – Faces Dual Lawsuits Over “Crippling” ATM Failures

Bitcoin Depot Inc. is dealing with mounting authorized and monetary stress after its Canadian subsidiary was hit with an $18.47 million arbitration award tied to long-running allegations that defective {hardware} and software program “crippled” hundreds of Bitcoin ATMs operated by bankrupt kiosk operator Cash Cloud

The ruling, disclosed in a Form 8-Okay submitting on November 24, provides a brand new layer of uncertainty to the Atlanta-based firm’s operations because it confronts a second lawsuit in search of the identical damages in U.S. Bankruptcy Court.

Arbitrators Side With Cash Cloud, Ruling Over Alleged Defects in BitAccess ATM Systems

According to the submitting, the award was issued by a tribunal below the Canadian Arbitration Association following hearings held between December 2024 and October 2025.

The dispute facilities on BitAccess Inc., a Canada-based working system and {hardware} supplier that Bitcoin Depot acquired in 2021.

Cash Cloud, which ran greater than 5,700 Bitcoin ATMs below the Coin Cloud model earlier than submitting for Chapter 11 in 2023, alleged that defects in BitAccess-supplied gear left giant elements of its fleet inoperable and prompted extreme monetary losses.

The arbitration started in August 2022 after Cash Cloud accused BitAccess of breaching a 2020 Master Purchase Agreement.

Arbitrators finally concluded that Cash Cloud had confirmed the complete extent of the damages it sought, issuing all the $18.47 million declare as the ultimate award.

Bitcoin Depot mentioned BitAccess intends to problem the ruling and is in search of to have it put aside, although the corporate acknowledged within the submitting that it “can not predict with any diploma of certainty” what the end result will likely be.

Arbitration awards function like courtroom judgments and might be enforced except efficiently challenged, usually on jurisdictional points or procedural irregularities.

Bitcoin Depot didn’t point out whether or not it’s going to comply if the award stands, solely that it plans to “vigorously defend” the matter.

Cross-Border Legal Clash Adds Pressure to Bitcoin Depot’s Mixed Financial Quarter

In addition to the arbitration, Bitcoin Depot also faces a parallel authorized battle in Nevada.

Cash Cloud filed a companion lawsuit within the U.S. Bankruptcy Court for the District of Nevada in 2023, arguing that sure claims fall exterior the Canadian tribunal’s jurisdiction and alleging extra by-product damages stemming from the identical contract.

The Nevada case seeks the identical $18.47 million, that means Bitcoin Depot might face duplicate publicity if the disputes are usually not consolidated or restricted.

Bitcoin Depot argues the U.S. case overlaps considerably with the arbitration and believes developments in Canada might restrict and even moot the chapter litigation. The firm mentioned it’s going to proceed to defend the U.S. motion, calling it “with out benefit.”

Cash Cloud filed for Chapter 11 in February 2023, itemizing greater than $153.9 million in liabilities.

In its chapter proceedings, the corporate pointed to the disputed BitAccess gear, a failed software program settlement, an costly hack, and alleged misconduct by a former govt as contributors to its collapse.

The authorized stress comes at a time when Bitcoin Depot’s monetary efficiency is exhibiting combined indicators. The firm reported $162.5 million in third-quarter income, a 20% year-over-year enhance, whereas internet earnings rose 139% to $5.5 million over the identical interval.

However, each metrics declined quarter-to-quarter, with income falling about 6% from Q2 and internet earnings dropping roughly 55%.

Earnings per share got here in at $0.08, half the prior quarter’s $0.16. Bitcoin Depot operates more than 9,000 ATMs throughout the United States, Canada, and Australia.

Arbitration disputes are usually not unusual within the crypto business. Other corporations, together with Payward, the operator of Kraken, have faced post-award authorized challenges, with courts typically refusing enforcement on public coverage grounds.

In one instance cited within the submitting, Payward’s arbitration award in opposition to a UK shopper was denied enforcement by an English courtroom over issues it will hinder the shopper’s skill to pursue potential financial-regulatory claims.

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