Washington state’s Department of Financial Institutions (DFI) has ordered Bitcoin ATM operator Coinme to halt all money transmission services and repay over $8 million to customers. The regulator issued a Temporary Cease and Desist Order on December 1, 2025, alleging the Seattle-based firm illegally converted unredeemed customer funds into corporate revenue.
The DFI’s investigation found that Coinme required customers to purchase paper vouchers at kiosks and redeem them online. When vouchers went unredeemed within a specific timeframe, Coinme allegedly claimed the outstanding balances as its own income, a violation of the state’s Uniform Money Services Act.
“Washington’s money transmission laws exist to protect consumers that rely on licensed companies to safely transmit funds,” DFI Director Charlie Clark stated.
Is Bitcoin ATM Operator Coinme About to Lose Its License?
The order also charges that from 2020 to 2025, Coinme failed to maintain its legally required tangible net worth, submitted inaccurate reports, and did not properly disclose redemption timeframes to users.
Coinme now faces a potential revocation of its state money transmitter license, a $300,000 fine, and a possible 10-year industry ban for the company and its CEO, Neil Bergquist. The company has 20 days to request a hearing before the order becomes permanent.
In a statement, Coinme Chief Compliance Officer Ben Enea said the company is cooperating with regulators.
The Institutional Take
This action against Coinme is a significant escalation in the regulatory campaign targeting the operational grey areas of crypto-to-fiat gateways. For institutional desks, the key risk is not the solvency of one ATM operator but the precedent it sets for the treatment of customer funds held in limbo.
Regulators are clearly signaling an end to the tolerance of treating unclaimed crypto assets as breakage or miscellaneous income. This move pressures all consumer-facing crypto services to tighten their accounting, escheatment, and disclosure policies, introducing new compliance overhead that could compress margins for the entire sector.
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