After combating the FTX Contagion, Coin Cloud declares bankruptcy

On January 8, Coin Cloud, a major largest Bitcoin ATM providers in the United States and Brazil, filed for Chapter 11 bankruptcy. The company had suffered a crushing defeat from the crypto winter and the FTX meltdown, leaving it with millions of dollars in debts.

Coin Cloud somewhere between $50 million and $100 million in assets, which is far more than its debts of roughly 10,000 debtors. The company has chosen to file for bankruptcy as a result of the disparity between assets and obligations. At the time of publication, Coin Cloud owed close to $500 million, with its commitment to FTX via Genesis Global Trading becoming the main reason.

The Coin Cloud Ordeal's Beginnings

With more than 1100 Bitcoin ATMs installed worldwide, the company was doing well as one of the biggest American owners of digital currency machines. The company hoped to expand its reach to prestigious U.S. retail stores as the cryptocurrency industry started to take off. The COVID pandemic was the time when demand for Bitcoin ATMs soared over Coin Cloud's forecasts.

According to Coin Cloud's stats, it runs more than 5,000 automated teller machines in Brazil and the United States. More than 40 cryptocurrencies, including Bitcoin, Litecoin, Dogecoin, Bitcoin Cash, Ethereum, and many more, are supported via its ATMs.

But the crypto industry saw a major fall in 2022, which lowered the price of crypto assets like Bitcoin. As a result, Bitcoin lost nearly 70% of its value and fell from its record high of $69,000 set in 2021. At that point, Coin Cloud's firm began to struggle as fewer customers were purchasing Bitcoin due to the bearish trend.

When the FTX exchange crashed and the cryptocurrency industry saw a contagious fallout, it faced even greater financial difficulties. Genesis Global, its largest creditor, was seriously exposed to FTX and Alameda, FTX's sister business. The firm was negatively damaged by the situation surrounding FTX and Genesis's bankruptcy as well as the low revenue return during the crypto collapse, leaving it with little choice but to give up.

Genesis Global Trading, a division of Digital Currency Group, was named as Coin Cloud's top creditor in the bankruptcy case with a liability of over $100 million. Cole Kepro, with a liability of almost $8.5 million, is its second-largest creditor.

Projection for the Development of Crypto ATMs Worldwide

Despite the devastating collapse of the cryptocurrency market and businesses, the worldwide market for digital currencies has grown significantly since its size in 2018 and 2019. As an example, the market for cryptocurrency ATMs has grown dramatically despite the difficulties faced by cryptocurrency service providers. 33,281 ATMs, or 86.8% of all Bitcoin ATMs worldwide, are located in the United States, according to statistics from CoinATMRadar. With 2,554 ATMs, Canada comes in second place to the United States, accounting for 6.7% of all ATMs globally.

Bitcoin ATMs are still one of the key drivers of the development of the cryptocurrency system. Despite the fact that there are fewer crypto ATMs than fiat ATMs, studies indicate that as cryptocurrency achieve widespread acceptance over the years ahead, the number of crypto ATMs will increase significantly. Therefore, despite the difficulties facing the cryptocurrency business, there is still a need for Bitcoin ATMs.

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