13 February 2026
The Iowa Supreme Court has made a remarkable ruling in the case of Bitcoin Depot, a well-known Bitcoin ATM operator. A recent ruling ruled that the money deposited into a Bitcoin Depot ATM by victims of various scams in 2023 and 2024 must be returned to the company, not the victims. This decision overturns an earlier lower court ruling that had ordered the seized funds to be returned to the victims. How did this happen?
In July 2023 and February 2024, two victims were contacted by scammers who coerced them into transferring $14.000 worth of Bitcoin via a Bitcoin Depot ATM in Linn County. After the investigation, police seized the deposited cash, totaling $28.000. However, it proved impossible to recover the transferred Bitcoin.
A lower court ruled that this money should be returned to the victims. Bitcoin Depot appealed this ruling, which led to the current decision by the Supreme Court.
According to Judge Dana Oxley, the victims had entered into an agreement with Bitcoin Depot, in which they were warned in advance about potential scams. This meant that the victims had to own the wallets they used to send Bitcoin, a crucial requirement for successfully conducting a transaction at Bitcoin Depot ATMs.
One of the victims, Carrie Carlson, argued that her contract with Bitcoin Depot should be invalidated because she was under duress. But the Supreme Court ruled that the company had no way to know that Carlson and another victim were under duress. Judge Oxley rejected her arguments, stating: “The fact that Bitcoin Depot recognizes risks in its industry and warns its customers of potential scams does not make it liable for every improper transaction.”
The ruling ruled in Bitcoin Depot’s favor and ordered the confiscated funds to be returned to the company, leaving victims empty-handed. Bitcoin Depot noted that the decision underscores the need for due process and affirms the role crypto operators can play in preventing and tackling fraud.
A Bitcoin Depot spokesperson said: “We respect the Iowa Supreme Court’s decision and view it as a positive step in clarifying the legal framework surrounding crypto transactions.”
Bitcoin Depot isn’t alone in this case, however. The company is simultaneously fighting a larger legal battle in Iowa, following a lawsuit filed by Attorney General Brenna Bird in February. The allegations are shocking: Iowans have lost an estimated $20,4 million to fraud via Bitcoin Depot and another ATM provider, CoinFlip. According to the attorney general’s office, a whopping 98,16% of the money sent via Bitcoin Depot since October 2023 has been lost to scams.
Bird added that fraudulent schemes often target older Iowans and that crypto ATM companies are more likely to contribute to this problem. “It even appears that they’re going through obituaries to target widowers […] And the crypto ATM companies are cutting into the profits,” Bird said.
However, during these turbulent times, Bitcoin Depot remains optimistic. The company has implemented several precautions, such as identification verification, transaction monitoring, and live support, to combat scams. The spokesperson added: “Our dedicated law enforcement liaison team, comprised of former law enforcement officers, works closely with agents across the country.”
Have you ever thought about the impact of crypto on our daily lives? As this technology continues to penetrate the world, we cannot deny that it brings both opportunities and challenges.
What was the Iowa Supreme Court ruling on Bitcoin Depot?
The Iowa Supreme Court ruled that money deposited by scam victims into Bitcoin Depot ATMs must be refunded to Bitcoin Depot, not the victims.
When did the scams take place?
The scams took place in July 2023 and February 2024, with victims being coerced into transferring $14.000 worth of Bitcoin.
What are the consequences of this ruling for the victims?
Victims are left financially disadvantaged as the money seized by police will now be returned to Bitcoin Depot, leaving them empty-handed.
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