Most financial technology executives have never heard of Coinme, yet the Seattle-based company powers cryptocurrency transactions across thousands of retail locations and mobile applications throughout the United States. This invisibility reflects a deliberate strategic transformation: Neil Bergquist’s company has evolved from operating visible Bitcoin ATMs to providing the unseen infrastructure that enables other financial institutions to offer cryptocurrency services.
The transformation illustrates a broader trend in financial technology, where specialized infrastructure providers enable traditional financial institutions to offer new services without building complex compliance and technical capabilities internally. Coinme’s evolution from consumer-facing hardware to business-to-business software services demonstrates how fintech companies can create sustainable competitive advantages through regulatory expertise and technical specialization.
The Infrastructure Pivot
Bergquist co-founded Coinme in 2014, launching the first licensed Bitcoin ATM in the United States. The physical machines provided cryptocurrency access to consumers but required significant capital investment, retail partnerships, and ongoing maintenance costs. More importantly, the ATM business limited Coinme’s growth to the number of physical locations the company could deploy and service.
The shift to infrastructure services changed the company’s economic model fundamentally. Rather than serving consumers directly, Coinme now operates as a “leading licensed and regulated provider of Crypto-as-a-Service,” offering a “B2B2C crypto and stablecoin enablement platform.” This approach enables the company to serve millions of end users through partner integrations without directly acquiring or servicing those customers.
The Value Proposition for Financial Institutions
Coinme’s Crypto-as-a-Service platform “enables a fully native and seamless crypto exchange and payment experience within our partners’ web or mobile apps.” This capability allows financial institutions to offer cryptocurrency services without investing in regulatory compliance, technical infrastructure, or operational expertise required for direct cryptocurrency operations.
The regulatory component represents the most significant barrier for most financial institutions. Cryptocurrency services require money transmitter licenses across multiple states, anti-money laundering compliance programs, and ongoing regulatory reporting capabilities. Building these capabilities internally requires substantial legal expenses, compliance staff, and regulatory relationships that can take years to establish.
Bergquist’s decade of regulatory engagement has created what amounts to infrastructure-as-a-service for financial compliance. Rather than each institution building separate compliance capabilities, multiple partners can leverage Coinme’s existing regulatory framework and operational infrastructure.
Economic Advantages
The recent Exodus partnership demonstrates the economic benefits of this approach. “By creating a Web2 checkout experience in a Web3 self-custody wallet, Exodus has set a new bar for crypto user experience,” Bergquist noted. According to Bergquist, “Exodus’ innovative integration of Coinme’s APIs delivers the seamless in-app purchase flow users expect while keeping them in full control of their assets.”
The integration allows Exodus to offer comprehensive cryptocurrency purchasing capabilities without building payment processing, regulatory compliance, or customer service infrastructure. The partnership enables faster time-to-market, reduced development costs, and lower ongoing operational expenses compared to internal development.
Market Position
Coinme’s transformation from a visible hardware operator to an intangible crypto infrastructure provider reflects broader changes in financial technology. Specialized providers like Coinme increasingly handle commodity functions—payment processing, regulatory compliance, identity verification—while customer-facing companies focus on user experience and brand differentiation.
This specialization creates sustainable competitive advantages for infrastructure providers like Coinme that can achieve economies of scale across multiple customer relationships. The regulatory and technical investments required for cryptocurrency infrastructure become more cost-effective when spread across numerous partner integrations rather than supporting a single consumer-facing application.
