Bitcoin Depot ATM Operator Says $3.6 Million in BTC Stolen in Corporate Hack

Bitcoin ATM operator Bitcoin Depot Inc. published in an SEC filing On Wednesday, hackers stole approximately 50.9 BTC worth $3.665 million from company-controlled wallets during a security breach on March 23.

The attackers gained access to the company’s IT systems and obtained credentials for digital asset settlement accounts, allowing them to transfer the cryptocurrency without permission.

Following the discovery of the breach, Bitcoin Depot said it activated its incident response protocols and engaged third-party cybersecurity experts to investigate the attack vector and secure remaining assets. The company has also notified law enforcement authorities, but did not specify which agencies are involved in the investigation.

Despite the settlement account compromise and asset loss, Bitcoin Depot stated that its customer-facing platforms and user data were unaffected by the breach.

Bitcoin Depot has yet to make a public statement about the breach at the time of writing, aside from the SEC filing. Declutter I reached out to a company spokesperson for comment but did not immediately receive a response.

The company classified the incident as material to its operations, citing potential reputational damage in addition to legal, regulatory and incident response costs. Bitcoin Depot recorded a preliminary loss estimate of $3.665 million, based on the value of Bitcoin at the time of the theft.

The disclosure did not specify whether the company has insurance coverage for digital asset theft or how the loss could impact its Bitcoin ATM liquidity business through its machine network.

Bitcoin ATM operators have become attractive targets for cybercriminals due to the significant reserves of cryptocurrency they must maintain to facilitate customer transactions. These companies face unique security challenges as they bridge physical cash-to-crypto infrastructure with digital custody systems.

This marks at least the second known security incident at Bitcoin Depot a 2023 breach where hackers gained access to personal data of 58,000 users. The company has also faced increasing scrutiny from regulators, which was recently introduced stricter identity verification requirements for all ATM transactions, as authorities increase oversight of Bitcoin ATM operations.

Shares in Bitcoin Depot (BTM) spiked 15% during the trading day to end at a price of $2.74, but have fallen after hours of the SEC’s disclosure. The company’s shares are down 44% in the past 30 days.