Bitcoin Depot, the largest Bitcoin ATM operator in the United States, defied the volatile nature of cryptocurrency prices and disclosed solid profits in its recently filed 10-K annual report. Despite the roller coaster ride in cryptocurrency prices, the company's 2023 and 2022 revenues reached $689 million and $647 million, respectively, demonstrating its resilience to Bitcoin price fluctuations.
Bitcoin Depot's success despite market turmoil is due to its strategic approach to services primarily used for non-speculative purposes, including remittances, international transfers, and online purchases. The company's user surveys show that they prefer practical utility over speculative trading. Unlike institutions heavily involved in cryptocurrency trading or mining, Bitcoin Depot minimizes exposure to volatility by maintaining relatively low Bitcoin balances, typically less than $1 million, at any given time.
The company's proactive measures include purchasing Bitcoin through reputable liquidity providers instead of engaging in mining activities. This approach, combined with a sophisticated Bitcoin management process, effectively mitigates exposure to price volatility and sets Bitcoin Depot apart from its competitors.
Bitcoin Depot's operating model does not act as an agent or exchange for users in transactions, but rather maintains Bitcoin balances to meet user needs for kiosk or BDCheckout transactions. Cash from Bitcoin ATM kiosks accounts for approximately 21% of the company's average monthly revenue, highlighting its dual approach to Bitcoin and cash balance management that contributes to stability and resilience.
Despite the decline in installations witnessed in the Bitcoin ATM market in 2023, Bitcoin Depots are still the dominant players, operating over 7,000 BTMs globally. Competitors CoinFlip and BitStop operate 4,800 and 2,500 machines respectively. While the overall trend is a decline in the number of Bitcoin ATMs installed globally, Bitcoin Depot CEO Brandon Mintz is optimistic about the future of the industry, expecting a rebound after the expected Bitcoin halving. We are maintaining our position. This event, often associated with increased market activity and interest in cryptocurrencies, could further strengthen Bitcoin Depot's position in the market.
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