Bitcoin Depot's Revenues Unaffected by Bitcoin Price Volatility, Operates 7,000+ ATMs Globally
Summary:
Bitcoin Depot, the leading Bitcoin ATM operator in the US, has reported no correlation between its revenues and the volatility of Bitcoin prices. Regardless of Bitcoin's 155% surge in 2023, the firm only experienced 6% year-over-year revenue growth. The company limits exposure to Bitcoin price volatility by maintaining a relatively low Bitcoin balance and re-acquires Bitcoin only from leading liquidity providers. As of April 2024, Bitcoin Depot operates over 7,000 Bitcoin ATMs worldwide, topping its rivals CoinFlip and BitStop.
Despite the rollercoaster-like nature of cryptocurrency values, some key industry participants like Bitcoin Depot, a Bitcoin ATM service provider, remain unfazed. According to Bitcoin Depot - the primary Bitcoin ATM network in the US - there has historically been no discernible relationship between the firm's income and the fluctuations in Bitcoin's value, as disclosed in their April 15 10-K yearly report. The company's 2023 and 2022 earnings of $689 million and $647 million respectively show no associated trend with the Bitcoin value, even amid strong price turbulence. Despite the Bitcoin value rising by 155% in 2023, Bitcoin Depot reported a modest annual income growth of just 6%.
Considering the nature of Bitcoin Depot's operations partly clarifies the absence of any link between the firm's financial performance and the Bitcoin market price. According to surveys carried out on their customers, many of them utilize the company's product for utilitarian purposes such as transferring money, sending remittances internationally, and making online transactions rather than speculative trading.
The company has been focusing on minimizing its susceptibility to Bitcoin price instability by keeping a "comparably low balance" of Bitcoin, typically under $0.8 million, at any single moment. As stated in the filings, Bitcoin Depot usually purchases Bitcoin from a liquidity provider such as Cumberland DRW or Abra, and only re-acquires Bitcoin from top-notch Bitcoin liquidity providers, steering clear of any Bitcoin mining activity on their part.
The company emphasized that there are two crucial constituents of the working capital required for its functioning: Bitcoin stored in hot wallets to execute customer orders, and the cash that gathers in the Bitcoin ATM booths. As of December 31, 2023, the cash in the ATM booths represented approximately 21% of Bitcoin Depot's average monthly earnings.
Bitcoin Depot, which was established in 2023, runs a vast network of Bitcoin ATMs worldwide. These ATMs, commonly referred to as BTMs, grant users permission to deposit and withdraw money using cash or a debit card.
Data from CoinATMRadar shows that Bitcoin Depot currently stands as the world leader in operating cryptocurrency ATMs, with over 7,000 BTMs as of April 2024. Its closest competitors, CoinFlip and BitStop, manage 4,800 and 2,500 machines respectively.
In 2023, worldwide Bitcoin ATM installation saw its first-ever dip. That said, Bitcoin Depot CEO Brandon Mintz anticipates that the ATM industry will possibly witness a substantial revival after the eagerly awaited Bitcoin halving event, which is slated to happen this week.
Published At
4/16/2024 11:33:40 AM
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