--12-312024Q1false0001901799http://fasb.org/us-gaap/2023#UsefulLifeShorterOfTermOfLeaseOrAssetUtilityMemberhttp://fasb.org/us-gaap/2023#Revenueshttp://fasb.org/us-gaap/2023#Revenues00019017992024-01-012024-03-310001901799btm:TotalEquityAttributedToLegacyBitcoinDepotMember2023-01-012023-03-310001901799btm:BitcoinDepotInc.Memberus-gaap:CommonStockMember2023-06-300001901799srt:MaximumMemberbtm:LuxVendingLLCMember2023-01-130001901799btm:FounderPreferredStockMemberbtm:BtAssetsMember2023-06-300001901799btm:CommonClassOMember2023-12-310001901799btm:TaxReceivableAgreementMember2023-12-310001901799btm:ContingentConsiderationLiabilityMember2023-04-012023-12-310001901799btm:OldTermLoanMember2024-03-310001901799btm:CryptocurrenciesMemberbtm:BitcoinMember2024-03-310001901799btm:EquityAttributedToLegacyBitcoinDepotMember2023-03-310001901799us-gaap:AdditionalPaidInCapitalMember2024-03-310001901799btm:CryptocurrenciesMemberbtm:BitcoinMember2022-12-310001901799btm:NonControllingInterestsBitAccessAndBitcoinDepotIncMember2023-12-310001901799us-gaap:RestrictedStockUnitsRSUMemberbtm:BitAccessPlanMember2024-03-310001901799us-gaap:EmployeeStockOptionMemberbtm:BitAccessPlanMember2022-01-012022-12-310001901799btm:TwoThousandTwentyThreeIncentivePlanRSUMember2024-01-012024-03-310001901799btm:ExchangeableNciMember2024-01-012024-03-3100019017992023-01-012023-03-310001901799btm:BitAccessPlanMember2023-01-012023-03-310001901799btm:BTHoldCoLLCMemberbtm:TaxReceivableAgreementMember2024-01-012024-03-310001901799us-gaap:NoncontrollingInterestMember2023-01-012023-03-310001901799btm:BtAssetsMemberbtm:Class1EarnoutUnitsMember2023-01-012023-06-300001901799btm:CryptocurrenciesMember2022-12-310001901799btm:ClassVCommonStockMemberus-gaap:CommonStockMember2023-12-310001901799btm:BitAccessMember2023-07-312023-07-310001901799btm:BitAccessMember2024-01-012024-03-310001901799srt:MaximumMemberbtm:OldNoteMember2023-05-022023-05-040001901799us-gaap:NoncontrollingInterestMember2023-03-310001901799btm:ClassECommonStockMemberus-gaap:CommonStockMember2024-03-310001901799btm:PublicWarrantsMember2024-03-310001901799btm:CryptocurrenciesMemberbtm:BitcoinMember2023-12-310001901799btm:GSRMMemberbtm:SponsorMemberbtm:ClassETwoCommonStockMember2024-03-310001901799btm:BTHoldCoMember2024-03-310001901799btm:CryptocurrenciesMemberbtm:BitcoinMember2023-03-310001901799btm:BitAccessMember2022-01-012022-12-310001901799btm:PrivateWarrantsMember2024-03-310001901799btm:GSRMMemberbtm:SponsorMemberbtm:ClassEThreeCommonStockMember2024-03-310001901799btm:BDCheckoutMember2024-01-012024-03-310001901799btm:ClassVCommonStockMember2024-03-310001901799us-gaap:CommonClassAMember2023-09-222024-03-310001901799us-gaap:EmployeeStockOptionMemberbtm:BitAccessPlanMember2024-01-012024-03-310001901799btm:NewNoteMember2024-03-260001901799btm:BDCheckoutMember2024-01-012024-03-310001901799us-gaap:VehiclesMember2024-03-310001901799btm:CryptocurrenciesMemberbtm:EthereumMember2024-03-310001901799btm:CompanyWebsiteMember2024-01-012024-03-310001901799us-gaap:CommonClassAMemberbtm:SharePriceEqualOrExceedsEighteenRupeesPerDollarMember2024-01-012024-03-310001901799srt:MaximumMemberbtm:KioskMachinesLeasedMember2024-03-310001901799us-gaap:ParentMember2024-03-310001901799us-gaap:CommonClassBMember2024-01-012024-03-310001901799btm:CryptocurrenciesMemberbtm:BitcoinMember2024-01-012024-03-310001901799btm:CreditAgreementMember2023-12-310001901799srt:MaximumMember2023-09-220001901799btm:BTHoldCoMemberbtm:MajorityStockholderOfLuxVendingLlcBtAssetsIncMember2024-03-310001901799us-gaap:CommonClassAMember2024-05-130001901799btm:TimeBasedRestrictedStockUnitsMember2024-03-310001901799btm:CryptocurrenciesMemberbtm:BitcoinMember2023-01-012023-03-310001901799btm:GSRMMemberbtm:SponsorMemberbtm:ClassETwoCommonStockMember2024-01-012024-03-310001901799us-gaap:RetainedEarningsMember2023-12-310001901799us-gaap:CommonClassAMemberus-gaap:CommonStockMember2024-01-012024-03-310001901799btm:TotalEquityAttributedToLegacyBitcoinDepotMember2024-01-012024-03-310001901799us-gaap:RestrictedStockUnitsRSUMember2024-01-012024-03-310001901799btm:OldNoteMember2021-12-310001901799btm:BTMKioskMember2024-01-012024-03-310001901799us-gaap:EmployeeStockOptionMemberbtm:BitAccessPlanMember2023-01-012023-03-310001901799us-gaap:TreasuryStockCommonMember2024-03-310001901799us-gaap:RetainedEarningsMember2024-01-012024-03-310001901799us-gaap:CommonClassAMemberus-gaap:CommonStockMember2024-03-310001901799us-gaap:CommonClassAMemberbtm:SharePriceEqualOrExceedsEighteenRupeesPerDollarMember2024-03-310001901799us-gaap:SellingGeneralAndAdministrativeExpensesMember2024-01-012024-03-310001901799btm:OldNoteMember2020-12-210001901799us-gaap:EmployeeStockOptionMemberbtm:BitAccessPlanMember2023-03-310001901799btm:OtherDebtMember2024-03-310001901799btm:CryptocurrenciesMember2023-03-310001901799btm:EquityAttributedToLegacyBitcoinDepotMember2023-01-012023-03-310001901799btm:OldNoteMembersrt:MinimumMember2023-05-022023-05-040001901799btm:CommonClassMMember2024-03-310001901799btm:CommonClassOMember2024-03-310001901799us-gaap:SeriesAPreferredStockMember2024-05-130001901799btm:BitaccessInc.AndExpressVendingIncMember2024-01-012024-03-310001901799btm:BitcoinDepotInc.Member2024-01-012024-03-310001901799btm:NewNoteMember2023-06-232023-06-230001901799us-gaap:CustomerConcentrationRiskMemberbtm:NoMajorCustomerMemberus-gaap:SalesRevenueNetMember2024-01-012024-03-310001901799btm:CommonClassVMember2024-03-310001901799btm:ClassECommonStockEarnoutsMember2024-01-012024-03-310001901799btm:ClassVCommonStockMember2024-01-012024-03-310001901799us-gaap:PreferredStockMemberus-gaap:SeriesAPreferredStockMember2024-03-310001901799btm:OldNoteMember2023-05-022023-05-040001901799btm:FounderConvertiblePreferredUnitsMember2024-01-012024-03-310001901799us-gaap:ParentMember2023-12-310001901799btm:BitcoinTellerMachineMember2024-03-310001901799btm:OldNoteMember2020-12-212020-12-210001901799btm:CryptocurrenciesMemberbtm:EthereumMember2022-12-310001901799us-gaap:TreasuryStockCommonMember2024-01-012024-03-310001901799btm:CryptocurrenciesMember2023-12-310001901799btm:CryptocurrencyExchangesMember2023-12-310001901799btm:LuxVendingLLCMember2023-01-132023-01-130001901799us-gaap:CommonClassBMember2024-05-130001901799btm:FixedRatedNoteMember2024-03-310001901799btm:BTHoldCoLLCMember2023-01-012023-03-310001901799btm:TaxReceivableAgreementMember2023-09-300001901799srt:MaximumMemberbtm:BTHoldCoMember2024-01-012024-03-310001901799us-gaap:EmployeeStockOptionMemberbtm:BitAccessPlanMember2022-12-310001901799us-gaap:WarrantMember2024-01-012024-03-310001901799btm:EquityAttributedToLegacyBitcoinDepotMember2022-12-310001901799us-gaap:LeaseholdImprovementsMember2024-03-310001901799btm:CommonClassMMember2023-12-310001901799btm:SoftwareServicesMember2024-01-012024-03-310001901799btm:OtherDebtMember2023-12-310001901799btm:BtmKioskLeasesMember2023-01-012023-12-310001901799btm:ClassVCommonStockMember2024-05-130001901799btm:CryptocurrenciesMemberbtm:LitecoinMember2023-01-012023-03-310001901799btm:ClassVCommonStockMemberus-gaap:CommonStockMember2024-03-310001901799btm:CryptocurrenciesMemberbtm:LitecoinMember2022-12-310001901799us-gaap:CommonClassAMemberus-gaap:CommonStockMember2023-12-310001901799btm:ClassMCommonStockMember2024-03-310001901799us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-03-310001901799us-gaap:NoncontrollingInterestMember2023-12-310001901799us-gaap:NoncontrollingInterestMember2022-12-310001901799btm:SoftwareServicesMember2023-01-012023-03-310001901799btm:CryptocurrencyExchangesMember2024-03-310001901799us-gaap:EmployeeStockOptionMemberbtm:BitAccessPlanMember2024-03-310001901799btm:ClassOCommonStockMember2024-01-012024-03-310001901799us-gaap:PreferredStockMemberus-gaap:SeriesAPreferredStockMember2023-12-310001901799btm:ClassE3CommonStockMember2024-03-310001901799btm:ContingentConsiderationLiabilityMember2022-12-310001901799btm:NewNoteMember2023-06-300001901799btm:BitAccessMember2024-03-310001901799btm:BtmKioskLeasesMember2024-01-012024-03-310001901799btm:ClassOCommonStockMember2024-05-130001901799btm:TimeBasedRestrictedStockUnitsMember2024-01-012024-03-310001901799btm:GSRMMemberbtm:SponsorMemberus-gaap:CommonClassAMember2024-03-310001901799btm:BTHoldCoLLCMember2024-01-012024-03-310001901799btm:NonControllingInterestsBitAccessAndBitcoinDepotIncMember2024-03-310001901799btm:ClassECommonStockMemberus-gaap:CommonStockMember2023-12-310001901799btm:ClassE2CommonStockMember2024-03-310001901799btm:FinanceAgreementMemberbtm:BtmKioskLeasesMember2023-01-012023-12-310001901799us-gaap:RetainedEarningsMember2024-03-310001901799us-gaap:NoncontrollingInterestMemberbtm:BTHoldCoMember2024-03-310001901799btm:ClassECommonStockMember2024-01-012024-03-310001901799btm:TotalEquityAttributedToLegacyBitcoinDepotMember2023-12-310001901799us-gaap:EmployeeStockOptionMemberbtm:BitAccessPlanMember2023-12-310001901799btm:BitcoinDepotInc.Member2023-06-300001901799btm:MajorityStockholderOfLuxVendingLlcBtAssetsIncMember2024-03-310001901799us-gaap:NoncontrollingInterestMember2024-03-310001901799us-gaap:NoncontrollingInterestMemberbtm:BitAccessMember2024-03-310001901799us-gaap:CustomerConcentrationRiskMemberbtm:NoMajorCustomerMemberus-gaap:SalesRevenueNetMember2023-01-012023-03-310001901799btm:BitaccessInc.AndExpressVendingIncMember2023-01-012023-03-310001901799btm:PerformanceStockUnitsMemberus-gaap:SubsequentEventMember2024-04-012024-04-3000019017992022-12-310001901799us-gaap:NoncontrollingInterestMember2024-01-012024-03-310001901799btm:ClassOCommonStockMember2024-03-310001901799btm:BTMKioskMember2024-03-132024-03-130001901799btm:BtmKioskLeasesMember2023-12-310001901799us-gaap:ParentMember2024-01-012024-03-310001901799btm:ClassVCommonStockMemberbtm:MajorityStockholderOfLuxVendingLlcBtAssetsIncMember2024-03-310001901799us-gaap:EmployeeStockOptionMemberbtm:BitAccessPlanMember2023-01-012023-12-310001901799btm:BDCheckoutMember2023-01-012023-03-310001901799us-gaap:SeriesAPreferredStockMember2024-03-310001901799us-gaap:CommonClassAMember2024-01-012024-03-310001901799btm:PublicAndPrivateWarrantsMember2024-01-012024-03-310001901799us-gaap:SeriesAPreferredStockMember2023-06-300001901799us-gaap:CommonClassBMember2024-03-310001901799btm:BitcoinDepotMemberbtm:LitecoinMemberus-gaap:MajorityShareholderMember2023-01-012023-03-310001901799btm:TermLoanFacilityMember2024-03-260001901799btm:CryptocurrenciesMember2024-03-310001901799us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-12-310001901799us-gaap:NoncontrollingInterestMemberbtm:BitAccessMember2023-12-310001901799us-gaap:RestrictedStockUnitsRSUMember2024-03-310001901799btm:TwoThousandTwentyThreeOmnibusIncentivePlanMember2024-03-310001901799btm:NewNoteMember2023-06-230001901799btm:BTMKioskMember2024-01-012024-03-310001901799btm:TwoThousandTwentyThreeOmnibusIncentivePlanMember2024-01-012024-03-310001901799us-gaap:CommonClassBMember2023-12-310001901799us-gaap:CommonClassAMember2024-03-310001901799btm:GSRMMemberbtm:PublicWarrantsMember2024-03-310001901799btm:ClassEOneCommonStockMemberbtm:GSRMMemberbtm:SponsorMember2024-03-310001901799us-gaap:FurnitureAndFixturesMember2024-03-310001901799us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-01-012024-03-310001901799btm:CryptocurrenciesMemberbtm:EthereumMember2023-03-310001901799btm:EthereumMemberbtm:BitcoinDepotMemberus-gaap:MajorityShareholderMember2023-01-012023-03-310001901799btm:NewTermLoanMember2024-03-310001901799us-gaap:RestrictedStockUnitsRSUMemberbtm:BitAccessPlanMember2022-01-012022-12-310001901799btm:BtAssetsMember2023-06-302023-06-300001901799srt:MinimumMemberbtm:KioskMachinesLeasedMember2024-03-310001901799us-gaap:CommonClassAMember2023-12-310001901799btm:BitAccessMember2023-12-310001901799btm:CryptocurrenciesMember2023-01-012023-03-310001901799us-gaap:MajorityShareholderMember2023-01-012023-03-310001901799btm:OfficeSpaceLeasesMember2024-01-012024-03-310001901799btm:ClassECommonStockMember2023-12-310001901799us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-03-310001901799us-gaap:RestrictedStockUnitsRSUMemberbtm:BitAccessPlanMember2023-01-012023-03-310001901799btm:TotalEquityAttributedToLegacyBitcoinDepotMember2024-03-310001901799us-gaap:PreferredStockMemberus-gaap:SeriesAPreferredStockMember2024-01-012024-03-310001901799btm:ClassMCommonStockMember2024-01-012024-03-310001901799btm:ClassECommonStockMember2024-05-1300019017992023-12-310001901799us-gaap:TreasuryStockCommonMember2023-12-310001901799btm:ClassE1CommonStockMember2024-03-310001901799us-gaap:AdditionalPaidInCapitalMember2024-01-012024-03-310001901799us-gaap:RestrictedStockUnitsRSUMemberbtm:BitAccessPlanMember2022-12-310001901799btm:TotalEquityAttributedToLegacyBitcoinDepotMember2023-03-310001901799btm:CryptocurrenciesMemberbtm:EthereumMember2023-01-012023-03-310001901799btm:BtAssetsMemberbtm:Class2EarnoutUnitsMember2023-01-012023-06-300001901799us-gaap:RestrictedStockUnitsRSUMemberbtm:BitAccessPlanMember2024-01-012024-03-310001901799btm:BitcoinTellerMachineMember2023-12-310001901799btm:ClassECommonStockMemberbtm:SponsorMember2024-03-310001901799btm:HardwareMember2024-01-012024-03-3100019017992023-03-310001901799btm:CryptocurrenciesMember2024-01-012024-03-310001901799btm:NonControllingInterestsBitAccessAndBitcoinDepotIncMember2024-01-012024-03-310001901799btm:GSRMMemberbtm:SponsorMemberbtm:ClassEThreeCommonStockMember2024-01-012024-03-310001901799btm:BtAssetsMemberbtm:Class3EarnoutUnitsMember2023-01-012023-06-300001901799btm:TimeBasedRestrictedStockUnitsMemberus-gaap:SubsequentEventMember2024-04-012024-04-300001901799us-gaap:RestrictedStockUnitsRSUMember2023-12-310001901799us-gaap:SeriesAPreferredStockMember2023-12-310001901799us-gaap:AdditionalPaidInCapitalMember2023-12-310001901799us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-12-310001901799btm:BTHoldCoLLCMemberbtm:TaxReceivableAgreementMember2024-03-310001901799btm:BitcoinDepotMemberbtm:BTHoldCoLLCMemberbtm:TaxReceivableAgreementMember2024-01-012024-03-310001901799us-gaap:MajorityShareholderMember2024-01-012024-03-310001901799us-gaap:RestrictedStockUnitsRSUMemberbtm:BitAccessPlanMember2023-03-310001901799btm:LuxVendingLLCMembersrt:MinimumMember2023-01-130001901799btm:GSRMMember2024-03-310001901799btm:KioskMachinesOwnedMember2024-03-3100019017992024-03-310001901799btm:ClassEOneCommonStockMemberbtm:GSRMMemberbtm:SponsorMember2024-01-012024-03-310001901799btm:FixedRatedNoteMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2024-03-310001901799btm:PrivateWarrantsMemberbtm:GSRMMember2024-03-310001901799btm:ClassECommonStockMember2024-03-310001901799btm:ContingentConsiderationLiabilityMember2023-03-310001901799btm:BitcoinDepotMemberus-gaap:MajorityShareholderMember2023-01-012023-03-310001901799btm:OldNoteMember2022-03-310001901799btm:ClassMCommonStockMember2024-05-130001901799btm:TotalEquityAttributedToLegacyBitcoinDepotMember2022-12-310001901799btm:CompanyWebsiteMember2023-01-012023-03-310001901799btm:BTMKioskMember2023-01-012023-03-310001901799btm:CryptocurrenciesMemberbtm:EthereumMember2023-12-310001901799btm:BitAccessPlanMember2024-01-012024-03-310001901799btm:ContingentConsiderationLiabilityMember2023-01-012023-03-310001901799btm:CreditAgreementMember2024-03-310001901799btm:EarnoutUnitsMember2024-01-012024-03-310001901799us-gaap:SellingGeneralAndAdministrativeExpensesMember2023-01-012023-03-310001901799btm:IntuitiveSoftwareLLCMember2024-03-310001901799btm:CommonClassVMember2023-12-310001901799btm:BTMKioskMember2023-01-012023-03-310001901799btm:BDCheckoutMember2023-01-012023-03-31xbrli:purexbrli:sharesbtm:Ethbtm:Bitcoinmachinebtm:Tranchebtm:Ltcbtm:Segmentbtm:LeaseArrangementbtm:Seriesiso4217:USDiso4217:USDxbrli:shares
Table of Contents

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended March, 31, 2024

OR

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from __________ to __________

Commission File Number: 001-41305

 

Bitcoin Depot Inc.

(Exact name of registrant as specified in its charter)

 

 

Delaware

87-3219029

(State or other jurisdiction of

incorporation or organization)

(IRS Employer

Identification No.)

3343 Peachtree Road NE, Suite 750

Atlanta, GA

30326

(Address of principal executive offices)

(Zip Code)

(687) 435-9604

(Registrant’s telephone number, including area code)

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange

on which registered

 

 

 

 

 

Class A common stock, par value $0.0001 per share

 

BTM

 

The NASDAQ Stock Market LLC

Warrants, each whole warrant exercisable for one share of Class A common stock at an exercise price of $11.50 per share

 

BTMWW

 

The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No

As of May 13, 2024, the registrant had 17,345,855 shares outstanding of Class A common stock, par value $0.0001 per share, 3,075,000 shares outstanding of Series A Preferred Shares, par value of $0.0001, 0 shares outstanding of Class B common stock, par value $0.0001 per share, 1,075,761 shares outstanding of Class E common stock, par value $0.0001 per share, 0 shares outstanding of Class M common stock, par value $0.0001 per share, 0 shares outstanding of Class O common stock, par value $0.0001 per share, and 41,193,024 shares outstanding of Class V common stock, par value $0.0001 per share.

 

 


Table of Contents

 

Bitcoin Depot Inc.

Quarterly Report on Form 10-Q

Table of Contents

 

 

 

Page

Part I - Financial Information

1

Item 1.

Financial Statements

1

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

33

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

45

Item 4.

Controls and Procedures

45

 

PART II - OTHER INFORMATION

47

Item 1.

Legal Proceedings

47

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

47

Item 3.

Defaults upon Senior Securities

47

Item 4.

Mine Safety Disclosures

47

Item 5.

Other Information

47

Item 6.

Exhibits and Financial Statement Schedules

48

 

 

SIGNATURES

49

 

Forward-Looking Statements Safe Harbor Statement

 

Our disclosure and analysis in this report concerning our operations, cash flows and financial position, including, in particular, the likelihood of our success in developing and expanding our business and the realization of sales from our backlog, include forward-looking statements. Statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “estimates” and similar expressions are forward-looking statements. Although these statements are based upon reasonable assumptions, they are subject to risks and uncertainties that are described more fully herein and in our Annual Report on Form 10-K for the year ended December 31, 2023, in Part I, Item 1A, “Risk Factors” and in Part I under the heading "Cautionary Notice Regarding Forward-Looking Statements", as well as in our other filings with the Securities and Exchange Commission. These risks include our ability to successfully realize the expected benefits of the business combination; our ability to operate in existing markets or expand into new jurisdictions; our ability to manage our growth effectively; our ability to continue to operate in states where we have obtained the requisite licenses to the extent that the laws and regulations of such states clearly indicate that a license is required or where state regulators have advised us that we need a license to operate; our ability to manage regulatory uncertainty in the cryptocurrency industry and maintain positive relationships with federal and state regulators; our dependence on key business relationships with certain key suppliers of Bitcoin; our dependence on, and ability to maintain, key business relationships with store locations for our kiosks and franchise locations, and related supplies, programs, and technologies for our business on acceptable terms; the negative impact on our future results of operations of the unknown potential growth rate and demand for Bitcoin kiosks and by the slow adoption of cryptocurrency; our heavy dependency on our ability to win, maintain and renew contracts with store location partners; unfavorable macroeconomic conditions or decreased discretionary spending due to other factors such as increased interest rates, increased inflation, high fuel rates, recessions, epidemics or other public health issues, terrorist activity or threat thereof, civil unrest or other economic or political uncertainties, that could adversely affect our business, results of operations, cash flows and financial conditions; and our ability to obtain debt financing or refinance existing indebtedness on satisfactory terms, liquidity and trading of our public securities. Accordingly, we can give no assurance that we will achieve the results anticipated or implied by our forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.


 

i


Table of Contents

 

Part I - Financial Information

Item 1. Financial Statements.

BITCOIN DEPOT INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

 

 

 

 

 

 

 

 

 

March 31, 2024
(unaudited)

 

 

December 31, 2023

 

Assets

 

 

 

 

 

 

Current:

 

 

 

 

 

 

Cash and cash equivalents

 

$

42,151

 

 

$

29,759

 

Cryptocurrencies

 

 

441

 

 

 

712

 

Accounts receivable

 

 

348

 

 

 

245

 

Prepaid expenses and other current assets

 

 

8,766

 

 

 

6,554

 

Total current assets

 

 

51,706

 

 

 

37,270

 

Property and equipment:

 

 

 

 

 

 

Furniture and fixtures

 

 

635

 

 

 

635

 

Leasehold improvements

 

 

172

 

 

 

172

 

Kiosk machines - owned

 

 

24,667

 

 

 

24,222

 

Kiosk machines - leased

 

 

20,499

 

 

 

20,524

 

Total property and equipment

 

 

45,973

 

 

 

45,553

 

Less: accumulated depreciation

 

 

(23,228

)

 

 

(20,699

)

Total property and equipment, net

 

 

22,745

 

 

 

24,854

 

Intangible assets, net

 

 

3,502

 

 

 

3,836

 

Goodwill

 

 

8,717

 

 

 

8,717

 

Operating lease right-of-use assets, net

 

 

1,019

 

 

 

484

 

Deposits

 

 

577

 

 

 

412

 

Deferred tax assets

 

 

1,804

 

 

 

1,804

 

Total assets

 

$

90,070

 

 

$

77,377

 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

-1-


Table of Contents

 

BITCOIN DEPOT INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

 

 

 

 

 

 

March 31, 2024
(unaudited)

 

 

December 31, 2023

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

Current:

 

 

 

 

 

 

Accounts payable

 

$

10,576

 

 

$

8,337

 

Accrued expenses and other current liabilities

 

 

18,869

 

 

 

21,545

 

Notes payable

 

 

3,437

 

 

 

3,985

 

Income taxes payable

 

 

2,545

 

 

 

2,484

 

Deferred revenue

 

 

912

 

 

 

297

 

Operating lease liabilities, current portion

 

 

454

 

 

 

279

 

Current installments of obligations under finance leases

 

 

5,459

 

 

 

6,801

 

Other non-income tax payable

 

 

2,299

 

 

 

2,297

 

Total current liabilities

 

 

44,551

 

 

 

46,025

 

Long-term liabilities

 

 

 

 

 

 

Notes payable, non-current

 

 

35,863

 

 

 

17,101

 

Operating lease liabilities, non-current

 

 

666

 

 

 

319

 

Obligations under finance leases, non-current

 

 

2,293

 

 

 

2,848

 

Deferred income tax, net

 

 

851

 

 

 

846

 

Tax receivable agreement liability due to related party, non-current

 

 

865

 

 

 

865

 

Total Liabilities

 

 

85,089

 

 

 

68,004

 

Commitments and Contingencies (Note 18)

 

 

 

 

 

 

Stockholders’ Equity

 

 

 

 

 

 

Series A Preferred Stock, $0.0001 par value; 50,000,000 authorized, 3,075,000 and 3,125,000 shares issued and outstanding, at March 31, 2024 and December 31, 2023, respectively

 

 

 

 

 

 

Class A common stock, $0.0001 par value; 800,000,000 authorized, 13,721,691 and 13,602,691 shares issued, and 13,531,071 and 13,482,047 shares outstanding at March 31, 2024 and December 31, 2023, respectively

 

 

1

 

 

 

1

 

Class B common stock, $0.0001 par value; 20,000,000 authorized, no shares issued and outstanding at March 31, 2024 and December 31, 2023

 

 

 

 

 

 

Class E common stock, $0.0001 par value; 2,250,000 authorized, 1,075,761 shares issued and outstanding at March 31, 2024 and December 31, 2023

 

 

 

 

 

 

Class M common stock, $0.0001 par value; 300,000,000 authorized, no shares issued and outstanding at March 31, 2024 and December 31, 2023

 

 

 

 

 

 

Class O common stock, $0.0001 par value; 800,000,000 authorized, no shares issued and outstanding at March 31, 2024 and December 31, 2023

 

 

 

 

 

 

Class V common stock, $0.0001 par value; 300,000,000 authorized, 44,100,000 shares issued and outstanding at March 31, 2024 and December 31, 2023

 

 

4

 

 

 

4

 

Treasury stock

 

 

(437

)

 

 

(279

)

Additional paid-in capital

 

 

18,215

 

 

 

17,326

 

Accumulated deficit

 

 

(34,201

)

 

 

(32,663

)

Accumulated other comprehensive loss

 

 

(199

)

 

 

(203

)

Total Stockholders’ (Deficit) Attributable to Bitcoin Depot Inc.

 

 

(16,617

)

 

 

(15,814

)

Equity attributable to non-controlling interests

 

 

21,598

 

 

 

25,187

 

Total Stockholders’ Equity

 

 

4,981

 

 

 

9,373

 

Total Liabilities and Stockholders’ Equity

 

$

90,070

 

 

$

77,377

 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

-2-


Table of Contents

 

BITCOIN DEPOT INC.

CONSOLIDATED STATEMENTS OF (LOSS) INCOME AND COMPREHENSIVE (LOSS) INCOME

(UNAUDITED)

(in thousands, except share and per share amounts)

 

 

Three Months Ended March 31,

 

 

2024

 

 

2023

 

Revenue

 

$

138,539

 

 

$

163,603

 

Cost of revenue (excluding depreciation and amortization)

 

 

121,287

 

 

 

141,300

 

Operating expenses:

 

 

 

 

 

 

Selling, general, and administrative

 

 

13,606

 

 

 

10,836

 

Depreciation and amortization

 

 

2,947

 

 

 

2,796

 

Total operating expenses

 

 

16,553

 

 

 

13,632

 

Income from operations

 

 

699

 

 

 

8,671

 

Other (expense) income:

 

 

 

 

 

 

Interest (expense)

 

 

(4,944

)

 

 

(2,947

)

Other income (expense)

 

 

6

 

 

 

(115

)

(Loss) on foreign currency transactions

 

 

(127

)

 

 

(148

)

Total other (expense)

 

 

(5,065

)

 

 

(3,210

)

(Loss) Income before provision for income taxes and non-controlling interest

 

 

(4,366

)

 

 

5,461

 

Income tax benefit

 

 

138

 

 

 

622

 

Net (loss) income

 

 

(4,228

)

 

 

6,083

 

Net income attributable to Legacy Bitcoin Depot unit holders

 

 

 

 

 

6,291

 

Net (loss) attributable to non-controlling interest

 

 

(2,690

)

 

 

(208

)

Net (loss) attributable to Bitcoin Depot Inc.

 

 

(1,538

)

 

 

 

Other comprehensive income (loss), net of tax

 

 

 

 

 

 

Net (loss) income

 

 

(4,228

)

 

 

6,083

 

Foreign currency translation adjustments

 

 

13

 

 

 

 

Total comprehensive (loss) income

 

 

(4,215

)

 

 

6,083

 

Comprehensive income attributable to Legacy Bitcoin Depot unit holders

 

 

 

 

 

6,291

 

Comprehensive (loss) attributable to non-controlling interest

 

 

(2,677

)

 

 

(208

)

Comprehensive (loss) attributable to Bitcoin Depot Inc.

 

$

(1,538

)

 

$

 

Net (loss) attributable to Bitcoin Depot Inc.

 

$

(1,538

)

 

$

 

(Loss) per share basic and diluted

 

$

(0.25

)

 

 

 

Weighted average shares: basic and diluted

 

 

16,616,864

 

 

 

 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

-3-


Table of Contents

 

BITCOIN DEPOT INC.

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY

THREE MONTHS ENDED MARCH 31, 2024

(UNAUDITED)

(in thousands, except share and per share amounts)

 

Series A
Preferred Stock

 

Class A
Common Stock

 

Class E
Common Stock

 

Class V
Common Stock

 

Treasury Stock

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares

 

Amount

 

Shares

 

Amount

 

Shares

 

Amount

 

Shares

 

Amount

 

Shares

 

Amount

 

Accumulated
Other
Comprehensive Loss

 

Additional
Paid-In Capital

 

Accumulated Deficit

 

Total Stockholders’ (Deficit) and (Deficit) Attributable to Bitcoin Depot Inc.

 

Non-Controlling Interest

 

Total
Stockholders’
Equity

 

January 1, 2024

 

3,125,000

 

$

 

 

13,602,691

 

$

1

 

 

1,075,761

 

$

 

 

44,100,000

 

$

4

 

 

(120,644

)

$

(279

)

$

(203

)

$

17,326

 

$

(32,663

)

$

(15,814

)

$

25,187

 

$

9,373

 

Distributions

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(916

)

 

(916

)

Foreign currency translation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4

 

 

 

 

 

 

4

 

 

9

 

 

13

 

Conversion of Series A preferred stock to class A common stock

 

(50,000

)

 

 

 

50,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-based compensation expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

889

 

 

 

 

889

 

 

8

 

 

897

 

Treasury Shares

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(69,976

)

 

(158

)

 

 

 

 

 

 

 

(158

)

 

 

 

(158

)

Shares issued for vested RSU awards

 

 

 

 

 

69,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (loss) attributable to Bitcoin Depot Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,538

)

 

(1,538

)

 

(2,690

)

 

(4,228

)

March 31, 2024

 

3,075,000

 

$

 

 

13,721,691

 

$

1

 

 

1,075,761

 

$

 

 

44,100,000

 

$

4

 

 

(190,620

)

$

(437

)

$

(199

)

$

18,215

 

$

(34,201

)

$

(16,617

)

$

21,598

 

$

4,981

 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

-4-


Table of Contents

 

BITCOIN DEPOT INC.

CONSOLIDATED STATEMENT OF CHANGES IN MEMBER’S EQUITY

THREE MONTHS ENDED MARCH 31, 2023

(UNAUDITED)

(in thousands, except share and per share amounts)

 

 

Equity
Attributed to
Legacy Bitcoin
Depot

 

 

Accumulated
Other
Comprehensive
(Loss)

 

 

Total Equity
Attributed to
Legacy Bitcoin
Depot

 

 

Equity
Attributed
to Non-
Controlling
Interest

 

 

Total
Member’s
Equity

 

Balance at January 1, 2023

 

$

7,396

 

 

$

(182

)

 

$

7,214

 

 

$

2,230

 

 

$

9,444

 

Distributions

 

 

(505

)

 

 

 

 

 

(505

)

 

 

 

 

 

(505

)

Share-based compensation expense

 

 

 

 

 

 

 

 

 

 

 

191

 

 

 

191

 

Net income (loss)

 

 

6,291

 

 

 

 

 

 

6,291

 

 

 

(208

)

 

 

6,083

 

Balance at March 31, 2023

 

$

13,182

 

 

$

(182

)

 

$

13,000

 

 

$

2,213

 

 

$

15,213

 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

-5-


Table of Contents

 

BITCOIN DEPOT INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

(in thousands, except share and per share amounts)

 

 

Three Months Ended March 31,

 

 

2024

 

 

2023

 

Cash flows from Operating Activities:

 

 

 

 

 

 

Net (loss) Income

 

$

(4,228

)

 

$

6,083

 

Adjustments to reconcile net income to net cash (used in) operating activities:

 

 

 

 

 

 

Amortization of deferred financing costs

 

 

544

 

 

 

155

 

Accretion to contingent earn-out liability

 

 

 

 

 

69

 

Depreciation and amortization

 

 

2,947

 

 

 

2,796

 

Non-cash share-based compensation

 

 

897

 

 

 

191

 

Purchase of services in cryptocurrencies

 

 

347

 

 

 

292

 

Deferred taxes

 

 

5

 

 

 

(427

)

Loss on lease termination

 

 

 

 

 

533

 

Write-off of deferred financing costs

 

 

3,136

 

 

 

 

Loss on disposal of property and equipment

 

 

26

 

 

 

225

 

Reduction in carrying amount of right-of-use assets

 

 

49

 

 

 

24

 

Cryptocurrency received as payment

 

 

(485

)

 

 

(211

)

Change in operating assets and liabilities:

 

 

 

 

 

 

Deposits

 

 

(165

)

 

 

 

Accounts receivable

 

 

(104

)

 

 

(483

)

Cryptocurrencies

 

 

409

 

 

 

34

 

Prepaid expenses and other current assets

 

 

(364

)

 

 

(2,072

)

Accounts payable

 

 

2,241

 

 

 

84

 

Accrued expenses and other current liabilities

 

 

(4,524

)

 

 

2,655

 

Income taxes payable

 

 

61

 

 

 

74

 

Other non-income tax payable

 

 

2

 

 

 

 

Deferred revenue

 

 

615

 

 

 

28

 

Operating leases, net

 

 

(62

)

 

 

(40

)

Net Cash Flows Provided by Operations

 

 

1,347

 

 

 

10,010

 

Cash flows from Investing Activities:

 

 

 

 

 

 

Acquisition of property and equipment

 

 

(558

)

 

 

 

Net Cash Flows Used In Investing Activities

 

 

(558

)

 

 

 

Cash flows from Financing Activities:

 

 

 

 

 

 

Proceeds from issuance of notes payable

 

 

15,191

 

 

 

 

Principal payments on notes payable

 

 

(639

)

 

 

(2,250

)

Principal payments on finance lease

 

 

(1,896

)

 

 

(3,154

)

Payment of deferred financing costs

 

 

(19

)

 

 

 

Purchase of treasury stock

 

 

(158

)

 

 

 

Distributions

 

 

(916

)

 

 

(482

)

Net Cash Flows Provided by (Used In) Financing Activities

 

 

11,563

 

 

 

(5,886

)

Effect of exchange rate changed on cash and cash equivalents

 

 

40

 

 

 

1

 

Net change in cash and cash equivalents

 

 

12,392

 

 

 

4,125

 

Cash and cash equivalents - beginning of period

 

 

29,759

 

 

 

37,540

 

Cash and cash equivalents - end of period

 

$

42,151

 

 

$

41,665

 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

-6-


Table of Contents

 

BITCOIN DEPOT INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

(in thousands, except share and per share amounts)

 

 

Three Months Ended March 31,

 

 

2024

 

 

2023

 

Supplemental disclosures of cash flow information:

 

 

 

 

 

 

Cash paid during the three months ended March 31 for:

 

 

 

 

 

 

Interest

 

$

1,814

 

 

$

2,511

 

Income taxes

 

$

40

 

 

$

3

 

 

Supplemental disclosures of non-cash investing and financing activities:

See Note 4 for information on non-cash distribution to the Member.

See Note 12 for information on non-cash financing activity related to term loan agreements.

During the three months ended March 31, 2024, the Company amended its term loan agreement with its lender. The total principal on the old term loan of $19.9 million was extinguished and the new term loan's principal balance with the same lender is $35.6.million. The net proceeds from the issuance is recorded as an inflow from financing activities of $15.2 million, net of fees paid of $0.5 million.

See Note 17 for information on non-cash activity related to a lease termination and new lease arrangement.

The accompanying notes are an integral part of these unaudited consolidated financial statements.

-7-


 

BITCOIN DEPOT INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(1) Organization and Background

(a) Organization

Lux Vending, LLC (dba Bitcoin Depot) (“Legacy Bitcoin Depot”) was formed on June 7, 2016. Pursuant to a transaction with GSR II Meteora Acquisition Corp. (“GSRM”), a Delaware corporation formed on October 14, 2021, Legacy Bitcoin Depot merged with and into GSRM and GSRM was renamed Bitcoin Depot Inc. (“Bitcoin Depot”, or the “Company”) (see Note 2(a)). Bitcoin Depot owns and operates a network of cryptocurrency kiosks (“BTMs”) across North America where customers can buy and sell cryptocurrencies. In addition to the BTM network, Bitcoin Depot also sells cryptocurrency to consumers at a network of retail locations through its BDCheckout product offering and through its website. The BDCheckout offering allows users similar functionality to the BTM kiosks, enabling users to load cash into their accounts at the checkout counter at retailer locations, and use those funds to purchase cryptocurrency. The Company’s website allows users to purchase cryptocurrency online for which the Company earns a commission. Bitcoin Depot also offers a software solution to other BTM operators through its controlled subsidiary, BitAccess Inc. ("BitAccess").

(b) Background

Several factors affect the price of cryptocurrencies, including but not limited to: (a) global supply and demand; (b) investors’ expectations with respect to the rate of inflation; (c) interest rates; (d) currency exchange rates, including the rates at which cryptocurrencies may be exchanged for fiat currencies; (e) fiat currency withdrawal and deposit policies of electronic market places where traders may buy and sell cryptocurrencies based on bid-ask trading activity with the various exchanges and the liquidity of those exchanges; (f) interruptions in service from or failures of major cryptocurrency exchanges; (g) investment and trading activities of large investors, including private and registered funds, that may directly or indirectly invest in cryptocurrencies; (h) monetary policies of governments, trade restrictions, currency devaluations and revaluations; (i) regulatory measures, if any, that restrict the use of cryptocurrencies as a form of payment; (j) the maintenance and development of the open-source protocol governing the cryptocurrency’s network; (k) global or regional political, economic or financial events and situations; (l) expectations among market participants that the value of a cryptocurrency will soon change; and (m) the reduction in mining rewards of Bitcoin, including block reward halving events, which are events that occur after a specific period of time and reduces the block reward earned by miners.

Global supply for a particular cryptocurrency is determined by the asset’s network source code, which sets the rate at which assets may be awarded to network participants. Global demand for cryptocurrencies is influenced by such factors as the increase in acceptance by retail merchants and commercial businesses of a cryptocurrency as a payment alternative, the security of online exchanges and digital wallets, the perception that the use of cryptocurrencies is safe and secure, and the lack of regulatory restrictions on their use. Additionally, there is no assurance that any cryptocurrency will maintain its long-term value in terms of purchasing power. Any of these events could have a material adverse effect on the Company’s financial position and the results of its operations.

(c) Liquidity

As of March 31, 2024, the Company had current assets of $51.7 million, including cash and cash equivalents of $42.2 million, current liabilities of $44.6 million, total stockholders’ equity of $5.0 million and an accumulated deficit of $34.2 million. For the three months ended March 31, 2024, the Company recognized net loss of $4.2 million and generated positive cash flows from operations of $1.3 million, and had cash flows provided by financing activities of $11.6 million, primarily due to the issuance of notes payable. The Company expected its existing cash and cash equivalents, together with cash provided by operations, to be sufficient to fund its operations for a period of 12 months from the date that these consolidated financial statements are issued.

 

(d) Risks and Uncertainties

 

The operations of Bitcoin Depot are subject to various regulatory challenges and uncertainties. The Company's ability to operate and expand its cryptocurrency kiosk services in compliance with applicable laws and regulations is a significant risk factor that may impact its financial performance and overall business prospects. The regulatory landscape surrounding cryptocurrencies, including the operation of crypto kiosks, is rapidly evolving and can vary significantly from one jurisdiction to another. The impacts of heightened regulatory oversight is not yet known. For example, recent legislation in California regulates digital financial asset transaction kiosks (“crypto kiosks”) by imposing the following: limiting to $1,000 per day the amount of funds the kiosk operator can accept from or dispense at its crypto kiosks; limiting the direct and indirect charges an operator may collect from a customer for a single transaction to the greater of $5 or 15% of the dollar equivalent of the digital assets involved in the transaction; (iii) requiring that specific information (including the amount of fees, expenses and charges, as well as any spread between the dollar price of the digital asset

-8-


Table of Contents

BITCOIN DEPOT INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

charged to the customer and the dollar price for that asset listed by a digital asset exchange) be disclosed both prior to a transaction and on transaction receipts printed by crypto kiosks following the transaction; and (iv) requiring operators to provide the California Department of Financial Protection and Innovation with a list of all locations of the crypto kiosks that the operator owns, operates or manages in California. Other state agencies may propose and adopt new regulations (or interpret existing regulations) in ways that could result in significant adverse changes in the regulatory landscape for cryptocurrencies, regardless of whether these or other new laws are adopted.

 

The Company's financial performance and ability to achieve its business objectives may be significantly impacted by the outcome of ongoing regulatory discussions and potential changes in the regulatory framework governing cryptocurrencies in California and in other states that have passed, or may pass, similar legislation. These uncertainties may result in lower revenue and margin, increased compliance costs, operational restrictions, or limitations on the Company's ability to expand its services or enter new markets. Compliance with current and proposed legislation that has not yet been published may be more challenging than expected.

 

In addition, the Company's ability to obtain and maintain the necessary licenses, permits, and approvals from state regulatory authorities is subject to various factors beyond its control, including changes in laws, regulations, or interpretations thereof. Failure to comply with these requirements may result in penalties, fines, or even the suspension or termination of the Company's operations in the state.

(2) Basis of Presentation and Summary of Significant Accounting Policies

(a) Basis of Presentation

Unaudited Interim Financial Statements

The unaudited interim consolidated financial statements have been prepared in accordance with U.S. GAAP and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) with respect to interim reporting. The unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements of the Company as of December 31, 2023 on Form 10-K, filed with the SEC on April 15, 2024. The Company has included all normal recurring items and adjustments necessary for a fair presentation of the results of the interim period. The Company’s interim unaudited consolidated financial statements are not necessarily indicative of results that may be expected for any other interim period or for the full year.

The Company consolidates business enterprises that it controls by ownership of a majority voting interest. However, there are situations in which consolidation is required even though the usual condition of consolidation (ownership of a majority voting interest) does not apply. An enterprise must consolidate a Variable Interest Entity (“VIE”) if it is determined to be the primary beneficiary of the VIE. The primary beneficiary has both (a) the power to direct the activities of the VIE that most significantly impact the entity’s economic performance, and (b) the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE. The Company consolidates all entities that it controls by ownership of a majority voting interest as well as VIEs for which the Company is the primary beneficiary.

The consolidated financial statements of the Company include the accounts of Bitcoin Depot Inc. and its controlled subsidiaries: BT HoldCo, Bitcoin Depot Operating, LLC, Mintz Assets, Inc., Express Vending, Inc., Intuitive Software, LLC, Digital Gold Ventures, Inc. (“Digital Gold”), and BitAccess Inc. BT HoldCo is a holding company with ownership of Bitcoin Depot Operating, LLC. Bitcoin Depot Operating, LLC is a holding company with ownership of Mintz Assets, Inc. and Intuitive Software, LLC. Mintz Assets, Inc. is a holding company that holds the ownership of Express Vending, Inc. Express Vending, Inc. is a Canadian corporation whose business activities include owning and operating a network of BTM kiosks in Canada. Intuitive Software, LLC is a holding company that holds an 82.14% equity interest (through its ownership of Digital Gold) in BitAccess Inc., a Canadian corporation. The non-controlling interests held by investors directly in BT HoldCo and BitAccess are presented separately as further discussed in Note 10. Intercompany balances and transactions have been eliminated in consolidation.

Reverse Recapitalization

GSR II Meteora Acquisition Corp. (“GSRM”) was a blank check company incorporated as a Delaware corporation on October 14, 2021, for the purpose of effecting a merger or similar business combination with one or more businesses. On March 1, 2022, GSRM consummated its Initial Public Offering (“IPO”). On August 24, 2022, GSRM entered into a Transaction Agreement, as subsequently amended (the “Transaction Agreement”), by and among GSRM, GSR II Meteora Sponsor LLC (the “Sponsor”), Lux Vending, LLC (dba Bitcoin Depot) (“Legacy Bitcoin Depot”) and BT Assets, Inc. (“BT Assets”) (the “Transaction Agreement”). Prior to the events

-9-


Table of Contents

BITCOIN DEPOT INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

contemplated in the Transaction Agreement (collectively, the "Merger"), BT Assets was the sole owner and member in Legacy Bitcoin Depot (the "Member").

On June 30, 2023 (the “Closing Date”), Legacy Bitcoin Depot merged with and into Bitcoin Depot Operating LLC (“BT OpCo”), with BT OpCo surviving the Merger as the post-transaction operating company owned solely by a newly formed entity, BT HoldCo, LLC (“BT HoldCo”) with common units (the “BT HoldCo Common Units”), preferred units (the “BT HoldCo Preferred Units”) and earnout units (the “BT HoldCo Earnout Units”) outstanding and issued to BT Assets. In connection with the Merger, GSRM changed its name to Bitcoin Depot Inc., purchased BT HoldCo Common Units owned by BT Assets and was issued BT HoldCo Earnout Units and warrants issued by BT HoldCo to the Company to purchase a number of BT HoldCo Common Units equal to the number of shares of Class A common stock that may be purchased upon the exercise in full of all Warrants outstanding immediately after Closing (“BT HoldCo Matching Warrants”). The former owners of Legacy Bitcoin Depot (i.e., BT Assets and the owners thereof) were issued 44,100,000 non-economic, super voting shares of Class V common stock in Bitcoin Depot. The Class V common stock held by BT Assets corresponds to units held by BT Assets in BT HoldCo and represents non-controlling interests in the Company, as described in Note 10. Following the closing of the Merger, the Company is organized under an “Up-C” structure in which the business of the Company is operated by BT HoldCo and its subsidiaries, and Bitcoin Depot’s only material direct asset consists of equity interests in BT HoldCo. At June 30, 2023, the Company had issued and outstanding 12,358,691 common units, 4,300,000 Series A Preferred Units and 43,848,750 warrants in BT HoldCo. Also at June 30, 2023, BT Assets owned 41,200,000 common units, 2,900,000 Founder Preferred Units, 5,000,000 Class 1 Earnout Units, 5,000,000 Class 2 Earnout Units and 5,000,000 Class 3 Earnout Units in BT HoldCo.

Notwithstanding the legal form of the Merger pursuant to the Transaction Agreement, the Merger is accounted for as a reverse recapitalization. The Merger is accounted for as a common control transaction and reverse recapitalization in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”), as BT Assets controls BT OpCo both before and after the transactions. Legacy Bitcoin Depot is determined to be the predecessor and represents a continuation of BT OpCo’s balance sheet and consolidated statement of (loss) income and comprehensive (loss) income, reflective of the recapitalization of the Merger.

As a result of the reverse capitalization accounting, the assets and liabilities of Legacy Bitcoin Depot are reflected by the Company at their historical cost with no additional goodwill or intangible assets recorded, accompanied by a recapitalization of the equity structure.

In connection with the Merger, the Company’s Class A common stock is now listed on the National Association of Securities of Dealers Automated Quotations (“Nasdaq”) under the symbol BTM and the Warrants to purchase the Class A common stock are listed on the Nasdaq under the symbol BTMWW in lieu of the GSRM Ordinary Shares and GSRM’s warrants, respectively. GSRM’s units automatically separated into the GSRM’s Ordinary Shares and GSRM’s warrants and ceased trading separately on the Nasdaq following the Closing Date. Prior to the Merger, GSRM neither engaged in any operations nor generated any revenue. Until the Merger, based on GSRM’s business activities, it was a shell company as defined under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

The consolidated assets, liabilities and results of operations prior to the Merger reflect those of Legacy Bitcoin Depot, which represents the predecessor of the Company. All such references to the Company for periods prior to the Merger refer to the activity of Lux Vending, LLC.

In connection with the Merger, the Company became the sole managing member of BT HoldCo, which holds all of the Company’s operating subsidiaries, and has the sole authority to make the key operating decisions on behalf of BT HoldCo. As such, the Company determined that BT HoldCo is a VIE and the Company is the primary beneficiary. Accordingly, these consolidated financial statements include the assets, liabilities and results of operations of BT HoldCo.

(b) Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Estimates are used for, but not limited to, valuation of current and deferred income taxes, the determination of the useful lives of property and equipment, recoverability of intangible assets and goodwill, fair value of long-term debt, present value of lease liabilities and right-of-use assets, assumptions and inputs for fair value measurements used in business combinations, impairments of cryptocurrencies, share-based compensation and contingencies, including liabilities that the Company deems are not probable of assertion. The

-10-


Table of Contents

BITCOIN DEPOT INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from these estimates.

(c) Concentration of Credit Risk Arising from Cash Deposits in Excess of Insured Limits

The Company maintains cash in established U.S. and Canadian financial institutions that often will exceed federally insured limits. The Company has not experienced any losses in such accounts that are maintained at the financial institutions.

The Company maintains cash balances in its BTMs and in fiat wallets with cryptocurrency exchanges to facilitate the purchase and sale of cryptocurrencies. The cash balances in the BTMs are insured up to a specified limit. From time to time, the Company’s cash balance in the BTMs exceeds such limits. The Company had cash of $13.7 million and $12.2 million in BTMs at March 31, 2024 and December 31, 2023, respectively. Cash maintained in fiat wallets with cryptocurrency exchanges is not insured. The Company had $0.1 million in cash with cryptocurrency exchanges as of March 31, 2024 and December 31, 2023.

A significant customer concentration is defined as one from whom at least 10% of revenue is derived. The Company had no significant customer concentration for the three months ended March 31, 2024 and 2023.

(d) Cash and Cash Equivalents

Cash and cash equivalents includes cash maintained at various financial institutions, cryptocurrency exchanges, and in BTMs owned and leased by the Company.

Cash in transit consists of cash that is picked up by armored truck companies from the Company’s BTM machines but not yet deposited in the Company’s bank accounts. As of March 31, 2024 and December 31, 2023, the Company had cash in transit of $6.3 million and $5.3 million, respectively. Management evaluates cash in transit based on outstanding cash deposits on cash picked up by the armored truck companies, historical cash deposits and cash that is lost during transit, which is immaterial. The armored truck companies maintain insurance over theft and losses.

(e) Cryptocurrencies

Cryptocurrencies are a unit of account that function as a medium of exchange on a respective blockchain network, and a digital and decentralized ledger that keeps a record of all transactions that take place across a peer-to-peer network. The Company primarily purchases cryptocurrencies to sell to customers. The Company’s cryptocurrencies consisted primarily of Bitcoin (“BTC”) as of and for the three months ended March 31, 2024 and for the year ended December 31, 2023.

The Company accounts for cryptocurrencies as indefinite-lived intangible assets in accordance with Accounting Standards Codification (“ASC”) 350, Intangibles - Goodwill and Other, and they are recorded on the Company’s consolidated Balance Sheets at cost, less any impairments. The Company has control and ownership of its cryptocurrencies which are stored in both the Company’s proprietary hot wallets and hot wallets hosted by a third-party, BitGo, Inc.

The primary purpose of the Company’s operations is to buy and sell Bitcoin using the BTM kiosk network and other services. The Company does not engage in broker-dealer activities. The Company uses various exchanges and liquidity providers to purchase, liquidate and manage its cryptocurrency positions; however, this does not impact the accounting for these assets as intangible assets.

 

Crypto Custody Asset and Safeguarding Liability

 

In accordance with Staff Accounting Bulletin 121 (SAB 121), the Company determined that it has a safeguarding obligation with respect to cryptocurrencies held in third-party operator wallets and in a shared wallet with one of its liquidity providers. The Company has certain obligations to safeguard these assets and/or private keys from loss, theft, or other misuse. The Company has adopted measures to safeguard crypto assets it secures, including establishing security around private key management to minimize the risk of theft or loss. The Company measures the safeguarding obligation liability initially and subsequently at the fair value of the digital asset per the principal market in accordance with ASC 820, Fair Value Measurement, at midnight UTC on the last day of the reporting period. The custody asset is measured in the same manner, however, the carrying amount may be adjusted to reflect any actual or potential safeguarding loss events, such as those resulting from fraud or theft.

-11-


Table of Contents

BITCOIN DEPOT INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Impairment

Because the Company’s cryptocurrencies are accounted for as indefinite-lived intangible assets, the cryptocurrencies are tested for impairment annually or more frequently if events or changes in circumstances indicate it is more likely than not that the asset is impaired in accordance with ASC 350. The Company has determined that a decline in the quoted market price below the carrying value at any time during the assessed period is viewed as an impairment indicator because the cryptocurrencies are traded in active markets where there are observable prices. Therefore, the fair value is used to assess whether an impairment loss should be recorded. If the fair value of the cryptocurrency decreases below the initial cost basis or the carrying value during the assessed period, an impairment charge is recognized at that time in cost of revenue (excluding depreciation and amortization). After an impairment loss is recognized, the adjusted carrying amount of the cryptocurrency becomes its new accounting basis and this new cost basis will not be adjusted upward for any subsequent increase in fair value. For purposes of measuring impairment on its cryptocurrencies, the Company determines the fair value of its cryptocurrency on a non-recurring basis in accordance with ASC 820, Fair Value Measurement, based on quoted (unadjusted) prices on an active exchange in the United States that the Company has determined is its principal market (Level 1 inputs).

The Company purchases cryptocurrencies, which are held in the Company’s hot wallets, on a just-in-time basis to facilitate sales to customers and mitigate exposure to volatility in cryptocurrency prices. The Company sells its cryptocurrencies to its customers from its BTM kiosks and BDCheckout locations in exchange for cash, for a prescribed transaction fee applied to the current market price of the cryptocurrency at the time of the transaction, plus a predetermined markup. When the cryptocurrency is sold to customers, the Company relieves the adjusted cost basis of its cryptocurrency, net of impairments, on a first-in, first-out basis within cost of revenue (excluding depreciation and amortization).

The related cash flows from purchases and sales of cryptocurrencies are presented as cash flows from operating activities on the Consolidated Statements of Cash Flows.

See Notes 2(i) and 2(j) to the consolidated financial statements for further information regarding the Company’s revenue recognition and cost of revenue related to the Company’s cryptocurrencies.

(f) Property and Equipment

Property and equipment are stated at cost, less accumulated depreciation. Finance leases are stated at the present value of the future minimum lease payments, less accumulated depreciation. Expenditures for maintenance and repairs are expensed as incurred. The cost of assets sold, retired, or otherwise disposed of, and the related accumulated depreciation are eliminated from their respective accounts and any resulting gain or loss is recognized in the Consolidated Statements of (Loss) Income and Comprehensive (Loss) Income upon disposition.

Depreciation of property and equipment is determined using the straight-line method over the estimated useful lives of the assets, which are as follows:

 

Furniture and fixtures

7 years

Leasehold improvements

Lesser of estimated useful life or life of the lease

Kiosk machines - owned

5 years

Kiosk machines - leased

2-5 years

Vehicles

5 years

 

Depreciation expense for the three months ended March 31, 2024 and 2023 totaled $2.6 million, and $2.4 million, respectively.

(g) Impairment of Long-Lived Assets

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be fully recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the asset group to its fair value, which is normally determined through analysis of the future net cash flows expected to be generated by the asset group. If such asset group is considered to be impaired, the impairment to be recognized is measured by the amount that the carrying amount of the asset group exceeds the fair value of the asset group. There were no impairments of long-lived assets for the three months ended March 31, 2024 and 2023.

-12-


Table of Contents

BITCOIN DEPOT INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(h) Goodwill and Intangible Assets, net

Goodwill represents the excess of the consideration transferred over the estimated fair value of the acquired assets, assumed liabilities, and any non-controlling interest in the acquired entity in a business combination. The Company tests for impairment at least annually, or more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying value. The Company performs their annual test for impairment as of December 31 at the reporting unit level. There was no impairment of goodwill for the three months ended March 31, 2024 and 2023.

Intangible assets, net consist of tradenames, customer relationships, and software applications. Intangible assets with finite lives are amortized over their estimated lives and evaluated for impairment when an event or change in circumstances occurs that warrants such a review. Management periodically evaluates whether changes to estimated useful lives of intangible assets are necessary to ensure its estimates accurately reflect the economic use of the related intangible assets.

(i) Revenue Recognition

BTM Kiosks and BDCheckout

Revenue is principally derived from the sale of cryptocurrencies at the point-of-sale on transactions initiated by customers. These customer-initiated transactions are governed by terms and conditions agreed to at the time of each point-of-sale transaction and do not extend beyond the transaction. The Company charges a fee at the transaction level. The transaction price for the customer is the price of the cryptocurrency, which is based on the exchange value at the time of the transaction, plus a markup, and a flat fee. The exchange value is determined using real-time exchange prices and the markup percentage is determined by the Company and depends on the current market, competition, the geography of the location of the sale, and the method of purchase.

The Company’s revenue from contracts with customers is principally comprised of a single performance obligation to provide cryptocurrencies when customers buy cryptocurrencies at a BTM kiosk or through BDCheckout. BDCheckout sales are similar to sales from BTM kiosks in that, customers buy cryptocurrencies with cash; however, the BDCheckout transactions are completed at the checkout counter of retail locations, initiated using the Bitcoin Depot mobile app instead of through the BTM kiosks. Regardless of the method by which the customer purchases the cryptocurrency, the Company considers its performance obligation satisfied when control of the cryptocurrency is transferred to the customer, which is at the point in time the cryptocurrency is transferred to the customer’s cryptocurrency wallet and the transaction validated on the blockchain.

The typical process time for our transactions with customers is 30 minutes or less. Contract liabilities are amounts received from customers in advance of the Company transferring the cryptocurrencies to the customer’s wallet and the transaction validated on the blockchain. Contract liabilities are presented in “Deferred revenue” on the consolidated Balance Sheets and are not material as of March 31, 2024 and December 31, 2023.

Judgment is required in determining whether the Company is the principal or the agent in transactions with customers. The Company evaluates the presentation of revenue on a gross or net basis based on whether it controls the cryptocurrency before control is transferred to the customer (gross) or whether it acts as an agent by arranging for other customers on the platform to provide the cryptocurrency to the customer (net). The Company controls the cryptocurrency before it is transferred to the customer, has ownership risk related to the cryptocurrency (including market price volatility), sets the transaction fee to be charged, and is responsible for transferring the cryptocurrency to the customer upon purchase. Therefore, the Company is the principal in transactions with customers and presents revenue and cost of revenue (excluding depreciation and amortization) from the sale of cryptocurrencies on a gross basis.

(j) Cost of Revenue (excluding depreciation and amortization)

The Company’s cost of revenue consists primarily of direct costs related to selling cryptocurrencies and operating the Company’s network of BTM kiosks. The cost of revenue (excluding depreciation and amortization) caption includes cryptocurrency expenses, floorspace lease expenses, and kiosk operations expenses.

Cryptocurrency expenses

Cryptocurrency expenses include the cost of cryptocurrencies, fees paid to obtain cryptocurrencies, impairment of cryptocurrencies, gains on sales of cryptocurrencies on exchange, fees paid to operate the software on the BTM kiosks, and fees paid to transfer cryptocurrencies to customers.

-13-


Table of Contents

BITCOIN DEPOT INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Floorspace lease expenses

Floorspace lease expenses include lease expense for floorspace leases related to the placement of BTM kiosks.

Kiosk Operations expenses

Kiosk operations expenses include the cost of kiosk repair and maintenance and the cost of armored trucks to collect and transport cash deposited into the BTM kiosks.

The Company presents cost of revenue in the Consolidated Statements of (Loss) Income and Comprehensive (Loss) Income exclusive of depreciation related to BTM kiosks and amortization of intangible assets related to software applications, tradenames and customer relationships.

(k) Advertising

The Company expenses advertising costs as incurred. Advertising expenses were $1.7 million and $1.2 million for the three months ended March 31, 2024 and 2023, respectively. Amounts are included in selling, general and administrative expenses in the Consolidated Statements of (Loss) Income and Comprehensive (Loss) Income.

(l) Foreign Currency

The functional currency of the Company is the USD. The functional currency of Express Vending, Inc. is the Canadian Dollar. All revenue, cost and expense accounts are translated at an average of exchange rates in effect during the period. Assets and liabilities recorded in foreign currencies are translated at the exchange rate as of the balance sheet date. The resulting translation adjustments are recorded as a separate component of Stockholders’ Equity, identified as accumulated other comprehensive loss.

(m) Income Taxes

Bitcoin Depot Inc. is treated as a corporation for federal income tax purposes.

BT HoldCo is treated as a partnership for federal income tax purposes. Bitcoin Depot Operating, LLC is a Single-Member Limited Liability Company and owned by BT HoldCo and with the consent of BT HoldCo, has elected under the Internal Revenue Code and similar state statutes to be a disregarded entity. In lieu of federal corporate income taxes, Bitcoin Depot Operating, LLC reflects its operating results on BT HoldCo’s federal tax return as a division of the partnership. As such, there were no federal income taxes for these entities.

Mintz Assets, Inc., is treated as a corporation for federal income tax purposes. Intuitive Software, LLC., and its wholly owned subsidiary, Digital Gold, are treated as corporations for federal income tax purposes. BitAccess Inc., and Express Vending, Inc., are each taxed as Canadian corporations. For the three months ended March 31, 2024 and 2023, there was no activity for Mintz Assets, Inc., Intuitive Software, LLC and Digital Gold. As such, there were no federal income taxes for these entities.

Deferred taxes are recognized for future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax basis and net operating loss carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

The effect of any tax rate change on deferred taxes is recognized in the period that includes the enactment date of the tax rate change. Realization of deferred tax assets is assessed on an annual basis and, unless a deferred tax asset is more likely than not to be utilized, a valuation allowance is recorded to write down the deferred tax assets to their net realizable value. In assessing the realizability of deferred income tax assets, management considers whether it is more-likely-than-not that some portion or all of the deferred income tax assets will be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those deductible temporary differences reverse. Management considers the scheduled reversal of deferred income tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. For uncertain income tax positions, the Company uses a more-likely-than-not recognition threshold based on the technical merits of the income tax position taken. Income tax positions that meet the more-likely-than-not recognition threshold are measured in order to determine the tax benefit recognized in the financial statements. The Company recognizes accrued interest

-14-


Table of Contents

BITCOIN DEPOT INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

related to unrecognized tax benefits as part of income tax expense. Penalties, if incurred, are recognized as a component of income tax expense.

(n) Fair Value of Financial Instruments

Certain assets and liabilities are reported or disclosed at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in the Company’s principal market for such transactions. If the Company has not established a principal market for such transactions, fair value is determined based on the most advantageous market. The Company uses a three-level hierarchy that prioritizes fair value measurements based on the types of inputs used for the various valuation techniques. The three levels of the fair value hierarchy are described below:

Level 1: Quoted (unadjusted) prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.
Level 2: Inputs other than quoted prices that are either directly or indirectly observable, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3: Inputs that are generally unobservable, supported by little or no market activity, and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability.

The categorization of an asset or liability within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The valuation techniques used by the Company when measuring fair value maximize the use of observable inputs and minimize the use of unobservable inputs.

(o) Share-Based Compensation

BitAccess

The Company maintains an equity award plan under which the officers and employees of BitAccess were awarded various types of share-based compensation, including options to purchase shares of BitAccess’ common stock and restricted stock units.

 

For stock options, share-based compensation expense is based on the fair value of the awards on the date of grant, as estimated using

the Black-Scholes option pricing model. The model requires management to make a number of assumptions, including the fair value and expected volatility of BitAccess' underlying BitAccess common stock price, expected life of the option, risk-free interest rate, and expected dividend yield. The fair value of the underlying stock is estimated the fair value of BitAccess common stock on the date of grant. The expected stock price volatility assumption for BitAccess' stock is determined by using a weighted average of the historical stock price volatility of comparable companies from a representative peer group, as BitAccess stock is not actively traded. The Company uses historical exercise information and contractual terms of options to estimate the expected term. The risk-free interest rate for periods within the expected life of the option is based on the U.S. Treasury zero coupon bonds with terms consistent with the expected term of the award at the time of grant. The expected dividend yield assumption is based on BitAccess’ history and expectation of no dividend payouts.

2023 Omnibus Incentive Plan

In conjunction with the close of the Merger the Company established the Bitcoin Depot Inc. 2023 Omnibus Incentive Plan (the “Incentive Plan”) under which officers, directors, and employees may be awarded various types of share-based compensation, including but not limited to, restricted stock, stock options, and restricted stock units. Under the Incentive Plan, the Company has granted time-based and issued performance-based restricted stock units ("RSUs"). The Company recognizes compensation expense for the RSUs in accordance with ASC 718 - Compensation - Stock Compensation, ("ASC 718").

 

For RSUs, share-based compensation expense is based on the fair value of the Company’s Class A common stock at the closing price on the day before the date of grant. Share-based compensation expense associated with time-based RSUs is recognized on a straight-line basis over the award’s requisite service period (generally the vesting period). Share-based compensation expense associated with

-15-


Table of Contents

BITCOIN DEPOT INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

performance-based RSUs is determined based on the number of performance-based RSUs that are earned based on the Company's achievement of certain adjusted EBITDA targets that are determined and approved by the Company's Compensation Committee at its sole discretion. Forfeitures of awards granted under the Incentive Plan are accounted for at the time the forfeiture occurs.

(p) Segment Reporting

Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by the Chief Operating Decision Maker (the “CODM”) in deciding how to allocate resources to an individual segment and in assessing performance. The Company’s Chief Executive Officer is the Company’s CODM. The CODM reviews financial information presented on a global, consolidated basis for purposes of making operating decisions, allocating resources, and evaluating financial performance. As such, the Company has determined that it operates as one operating segment and one reportable segment, and substantially all of the Company's revenues and long-lived assets are located in the U.S.

(q) Net Income Per Share Attributable to Class A Common Stock

Basic earnings per share of Class A common stock is computed by dividing net income attributable to the Company by the weighted-average number of shares of Class A common stock outstanding and Series A Preferred Stock outstanding, which has similar economic rights to the Class A common stock during the same period. Diluted net income per share of Class A common stock is computed by dividing net income attributable to the Company by the weighted-average number of shares of Class A common stock outstanding adjusted to give effect to potentially dilutive securities. Potential shares of common stock consist of incremental shares issuable upon the assumed exercise of stock options and warrants, vesting of RSUs, vesting of Class E common stock and Class V common stock and conversion of the Company’s preferred stock, as applicable. The weighted-average shares outstanding used to compute net income per common share, basic and diluted, was 16,616,864 for the three months ended March 31, 2024. Net income per share is not presented for periods prior to the Merger as such amounts would not be meaningful to users of the financial statements because the equity structure materially changed in connection with the Merger.

(r) Litigation

The Company assesses legal contingencies in accordance with ASC 450 - Contingencies and determines whether a legal contingency is probable, reasonably possible or remote. When contingencies become probable and can be reasonably estimated, the Company records an estimate of the probable loss. When contingencies are considered probable or reasonably possible but cannot be reasonably estimated, the Company discloses the contingency when the probable or reasonably possible loss could be material. Legal costs are expensed in the period in which the costs are incurred.

(s) Earnouts

At the closing of the Merger, GSRM received a total of 1,075,761 earnout shares (“Sponsor Earnout Shares”) in the form of Class E common stock of the Company. In current form, the Sponsor Earnout Shares are represented by the Company’s Class E-1, E-2, and E-3 common stock, each class comprising of one-third (1/3) of the total Sponsor Earnout Shares, or 358,587 shares each. Class E-1 Shares automatically convert to Class A common stock if during the seven-year period following the closing of the Merger, the Company’s stock price is greater than $12.00 over 10 trading days (which may be consecutive or not consecutive) within any 20 consecutive trading days (“First Milestone”). Class E-2 and Class E-3 are subject to similar milestones. The “Second Milestone” is reached when the Company’s stock price is greater than $14.00 per share over any 10 trading days (which may be consecutive or not consecutive) within any 20 consecutive trading days during the seven-year period following the Merger. The “Third Milestone” has a threshold of $16.00 per share over any 10 trading days (which may be consecutive or not consecutive) within any 20 consecutive trading days during the 10-year period following the Merger.

In addition to the Sponsor Earnout Shares, certain owners of BT HoldCo are entitled to receive an additional 15,000,000 BT HoldCo Earnout Units (“BT Earnout”). The BT Earnout is structured similarly to the Sponsor Earnout Shares with consistent milestones and vesting conditions.

The Company evaluated the Sponsor Earnout Shares and BT HoldCo Earnout Shares under ASC 815-40, Derivatives and Hedging—Contracts in Entity’s Own Equity, and concluded equity classification is appropriate. As equity-classified contracts, the Sponsor Earnout Shares are not subject to remeasurement provided the conditions for equity-classification continue to be met. The Sponsor Earnout Shares have been recorded in connection with the reverse recapitalization accounting as part of the adjustment to accumulated deficit due to the absence of additional paid in capital.

-16-


Table of Contents

BITCOIN DEPOT INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

In connection with the Merger, the BT Earnout will be settled in Common Units which represent non-controlling interest, to be measured under the hypothetical liquidation at book value method, as described further in Note 10.

(t) Warrants

In connection with the Merger, the Company assumed a total of 43,848,750 Warrants, consisting of 31,625,000 Public Warrants and 12,223,750 Private Placement Warrants issued by GSRM which continue to be outstanding following the Merger. The outstanding Warrants are accounted for as freestanding equity contracts and are classified in equity under ASC 815-40, Derivatives and Hedging—Contracts in Entity’s Own Equity.

(u) Emerging Growth Company Status

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the Jumpstart our Business Startups Act of 2012, (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act and reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements.

(3) Recent Accounting Pronouncements

Accounting Pronouncement Adopted

In October 2021, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers,” which requires entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination as if the acquiring entity had originated the contracts. The standard is effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022. The Company adopted this accounting standard effective January 1, 2023 with no impact on the consolidated financial statements.

In June 2022, the FASB issued ASU 2022-03, “Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions,” which clarifies that contractual sale restrictions are not considered in measuring fair value of equity securities and requires additional disclosures for equity securities subject to contractual sale restrictions. The standard is effective for public companies for fiscal years beginning after December 15, 2023. Early adoption is permitted. The Company adopted this accounting standard effective January 1, 2024 with no material impact on the consolidated financial statements.

Accounting Pronouncement Pending Adoption

 

In October 2023, the FASB issued ASU 2023-06 "Disclosure Improvements: Codification Amendments in Response to the SEC's Disclosures Update and Simplification Initiative". The guidance amends certain disclosure and presentation requirements related to the statement of cash flows, accounting changes and error corrections, earnings per share, interim reporting, commitments, debt, equity, derivatives, transfers and services and various industry specific guidance. For entities subject to the SEC's existing disclosure requirements, the effective date for each amendment will be the date on which the SEC's removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective. However, if by June 30, 2027, the SEC has not removed the existing disclosure requirements, the amendments will not become effective. Early adoption is not permitted. The Company is still assessing the impacts to its consolidated financial statements.

 

In November 2023, the FASB issued ASU 2023-07 "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures". The amendments require entities to disclose significant segment expenses impacting profit and loss that are regularly provided to the chief operating decision maker. In addition, the amendments enhance interim disclosure requirements, clarify circumstances in which an entity can disclose multiple segment measures of profit or loss, provide new segment disclosure requirements for entities with a single reportable segment, and contain other disclosure requirements. The update is required to be applied retrospectively to prior periods presented, based on the significant segment expense categories identified and disclosed in the period of adoption. The amendments are required to be adopted for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024 with early adoption permitted. The Company is still assessing the impacts to its consolidated financial statements.

 

-17-


Table of Contents

BITCOIN DEPOT INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

In December 2023, the FASB issued ASU No. 2023-09 "Improvements to Income Tax Disclosures (Topic 740)". The ASU requires companies to break out their income tax expense, income tax rate reconciliation and income tax payments made in more detail. For public companies, the requirements will become effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is still assessing the impacts to its consolidated financial statements.

 

In December 2023, the FASB issued ASU 2023-08 "Intangibles—Goodwill and Other—Crypto Assets (Subtopic 350-60) Accounting for and Disclosure of Crypto Assets". ASU 2023-08 will require entities to measure crypto assets that meet the scope criteria at fair value and to reflect changes in fair value in net income each reporting period. The amendments in ASU 2023-08 will also require entities to present crypto assets measured at fair value separately from other intangible assets on the balance sheet and changes in the fair value measurement of crypto assets separately from changes in the carrying amounts of other intangible assets on the income statement. The amendments in the ASU are effective for all entities for fiscal years beginning after December 15, 2024, including interim periods within those fiscal years. Early adoption is permitted for both interim and annual financial statements that have not yet been issued or made available for issuance. The Company is still assessing the impacts to its consolidated financial statements.

(4) Related Party Transactions

During the three months ended March 31, 2023, the Company distributed to BT Assets 112.4 Litecoin ("LTC") and 7.5 Ethereum ("ETH") with a total cost basis of $0.02 million. Total cash distributions made to BT Assets during the three months ended March 31, 2024 and 2023 were $0.9 million and $0.5 million, respectively and are classified as cash outflows from financing activities in the Consolidated Statements of Cash Flows. The total cash and non-cash distributions are reflected in the Consolidated Statement of Changes in Stockholders’ Equity and the Consolidated Statement of Changes in Member's Equity.

At the closing of the Merger, the Company entered into a Tax Receivable Agreement with BT HoldCo and BT Assets. Pursuant to the Tax Receivable Agreement, the Company is generally required to pay BT Assets 85% of the amount of savings, if any, in U.S. federal, state, local, and foreign income taxes that we realize, or in certain circumstances are deemed to realize. See Note 14. Income Taxes for further discussion.

In connection with the closing of the Merger, the Company entered into separate indemnification agreements with its directors and executive officers. These agreements, among other things, require the Company to indemnify its directors and executive officers for certain costs, charges and expenses, including attorneys’ fees, judgments, fines and settlement amounts, reasonably incurred by a director or executive officer in any action or proceeding because of their association with the Company or any of its subsidiaries. No amounts have been recognized related to these agreements as of March 31, 2024.

 

(5) Revenue

Revenue disaggregated by revenue stream is as follows (in thousands):

 

Three Months Ended March 31,

 

2024

 

 

2023

 

BTM Kiosks

$

137,776

 

 

$

163,025

 

BDCheckout

 

210

 

 

 

360

 

Company Website

 

361

 

 

 

80

 

Software Services

 

136

 

 

 

138

 

Hardware Revenue

 

56

 

 

 

 

Total Revenue

$

138,539

 

 

$

163,603

 

 

-18-


Table of Contents

BITCOIN DEPOT INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

(6) Cost of Revenue (Excluding Depreciation and Amortization)

Cost of Revenue (excluding depreciation and amortization) is comprised of expenses associated with the selling of cryptocurrencies and operating the Company’s BTM kiosks, excluding depreciation and amortization. The following table presents cost of revenue (excluding depreciation and amortization) by category (in thousands):

 

Three Months Ended March 31,

 

2024

 

 

2023

 

Cryptocurrency expenses

$

108,464

 

 

$

127,661

 

Floorspace lease expenses

 

8,536

 

 

 

9,032

 

Kiosk operations expenses

 

4,287

 

 

 

4,607

 

Total Cost of Revenue (excluding depreciation and
amortization reported separately)

$

121,287

 

 

$

141,300

 

 

The following table presents the components of cryptocurrency expenses (in thousands):

 

Three Months Ended March 31,

 

2024

 

 

2023

 

Cost of Cryptocurrency (1) - BTM Kiosk

$

108,063

 

 

$

127,090

 

Cost of Cryptocurrency (1) - BDCheckout

 

183

 

 

 

309

 

Software Processing Fees

 

 

 

 

205

 

Exchange Fees

 

 

 

 

19

 

Mining Fees

 

218

 

 

 

33

 

Software Processing Fee - BDCheckout

 

 

 

 

5

 

Total cryptocurrency expenses

$

108,464

 

 

$

127,661

 

 

(1)
Cost of Cryptocurrency includes impairment losses recognized on cryptocurrencies net of any gains recognized from sales of cryptocurrencies on an exchange. Impairment of $2.1 million and $2.2 million were recognized for the three months ended March 31, 2024 and 2023. There were no gains from the sale of cryptocurrency during the periods.

The Company presents cost of revenue in the Consolidated Statements of (Loss) Income and Comprehensive (Loss) Income exclusive of depreciation related to BTM kiosks and amortization of intangible assets related to software applications, tradenames and customer relationships.

The following table reconciles amounts excluded from the cost of revenue (excluding depreciation and amortization) caption in the Consolidated Statements of (Loss) Income and Comprehensive (Loss) Income included in total depreciation and amortization expense in the Consolidated Statements of (Loss) Income and Comprehensive (Loss) Income for the period presented (in thousands):

 

Three Months Ended March 31,

 

2024

 

 

2023

 

Depreciation of owned BTM kiosks

$

1,242

 

 

$

681

 

Depreciation of leased BTM kiosks

 

1,261

 

 

 

1,663

 

Amortization of ROU asset

 

378

 

 

 

374

 

Total depreciation and amortization excluded from cost of
revenue

$

2,881

 

 

$

2,718

 

Other depreciation and amortization included in operating
expenses

 

66

 

 

 

78

 

Total depreciation and amortization

$

2,947

 

 

$

2,796

 

 

-19-


Table of Contents

BITCOIN DEPOT INC.

N