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

Bitcoin Depot Inc. is facing mounting legal and financial pressure after its Canadian subsidiary was hit with an $18.47 million arbitration award tied to long-running allegations that faulty hardware and software “crippled” thousands of Bitcoin ATMs operated by bankrupt kiosk operator Cash Cloud

The ruling, disclosed in a Form 8-K filing on November 24, adds a new layer of uncertainty to the Atlanta-based company’s operations as it confronts a second lawsuit seeking the same damages in U.S. Bankruptcy Court.

Source: SEC

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

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

The dispute centers on BitAccess Inc., a Canada-based operating system and hardware provider that Bitcoin Depot acquired in 2021.

Cash Cloud, which ran more than 5,700 Bitcoin ATMs under the Coin Cloud brand before filing for Chapter 11 in 2023, alleged that defects in BitAccess-supplied equipment left large parts of its fleet inoperable and caused severe financial losses.

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

Arbitrators ultimately concluded that Cash Cloud had proven the full extent of the damages it sought, issuing the entire $18.47 million claim as the final award.

Bitcoin Depot said BitAccess intends to challenge the ruling and is seeking to have it set aside, though the company acknowledged in the filing that it “cannot predict with any degree of certainty” what the outcome will be.

Arbitration awards function like court judgments and can be enforced unless successfully challenged, typically on jurisdictional issues or procedural irregularities.

Bitcoin Depot did not indicate whether it will comply if the award stands, only 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 legal battle in Nevada.

Cash Cloud filed a companion lawsuit in the U.S. Bankruptcy Court for the District of Nevada in 2023, arguing that certain claims fall outside the Canadian tribunal’s jurisdiction and alleging additional derivative damages stemming from the same contract.

The Nevada case seeks the same $18.47 million, meaning Bitcoin Depot could face duplicate exposure if the disputes are not consolidated or limited.

Bitcoin Depot argues the U.S. case overlaps substantially with the arbitration and believes developments in Canada may limit or even moot the bankruptcy litigation. The company said it will continue to defend the U.S. action, calling it “without merit.”

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

In its bankruptcy proceedings, the company pointed to the disputed BitAccess equipment, a failed software agreement, an expensive hack, and alleged misconduct by a former executive as contributors to its collapse.

The legal pressure comes at a time when Bitcoin Depot’s financial performance is showing mixed signals. The company reported $162.5 million in third-quarter revenue, a 20% year-over-year increase, while net income rose 139% to $5.5 million over the same period.

Source: Bitcoin Depot

However, both metrics declined quarter-to-quarter, with revenue falling about 6% from Q2 and net income dropping roughly 55%.

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

Arbitration disputes are not uncommon in the crypto industry. Other firms, including Payward, the operator of Kraken, have faced post-award legal challenges, with courts sometimes refusing enforcement on public policy grounds.

In one example cited in the filing, Payward’s arbitration award against a UK consumer was denied enforcement by an English court over concerns it would hinder the customer’s ability to pursue potential financial-regulatory claims.