Washington Halts CoinMe Operations Over Unredeemed Funds
Washington state authorities have ordered CoinMe, a crypto ATM operator, to cease operations after regulators discovered financial mismanagement involving about $8 million in customer assets.
Allegations from Regulators
According to the Washington State Department of Financial Institutions, CoinMe recorded nearly $8 million in unredeemed customer funds as corporate income. Regulators stated that these funds should have remained on the company’s balance sheet as a liability to customers rather than being treated as revenue.
Company Misrepresentation and Oversight
CoinMe, which runs a network of cryptocurrency ATMs across the United States, is accused of violating state financial regulations by improperly accounting for user deposits. The oversight reportedly inflated the company’s revenues on paper and concealed potential risks to customer funds.
Authorities emphasized that users who had not yet redeemed their Bitcoin or cash equivalents could have been exposed to losses if the company faced liquidity issues.
Official Action and Market Response
The order requires CoinMe to halt its Washington operations and address accounting deficiencies before resuming business in the state. The company has not yet issued an official statement regarding the regulatory decision.
Industry observers note that this enforcement highlights ongoing concerns about transparency and custodial practices in the crypto ATM sector, where user funds often remain outside traditional financial safeguards.
“This case underscores the importance of proper accounting and consumer protection in digital asset businesses,” regulators stated.
Summary
Washington regulators suspended CoinMe’s operations after finding it had counted $8 million in unredeemed user funds as income instead of liabilities.
Author’s summary: Regulators in Washington halted CoinMe after it mislabeled $8 million in user-held crypto as income, spotlighting accountability issues across the crypto ATM market.
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