Those who seek ways to buy or sell Bitcoin may eventually come across Bitcoin ATMs. These Automated Teller Machines operate just like a bank version, but they require far less personal information. Not all of these machines offer bi-directional functionality, however.
The Purpose of Bitcoin ATMs
Bringing cryptocurrency to the public is a very difficult task. A lot of people remain wary of Bitcoin and other similar currencies. Although there is no reason to distrust this movement, it is understandable not everyone wants to use exchanges or brokers to buy and sell BTC. It is for this reason that Bitcoin ATMs were created, as they are more user-friendly.
These kiosks look and feel like a traditional bank ATM, but only serve Bitcoin needs. It is always possible to buy BTC from these machines. Some may even allow for selling Bitcoin in exchange for fiat currency, which is referred to as a bi-directional ATM. In recent years, these latter types of Bitcoin ATMs have become more prevalent around the globe.
Operating a Bitcoin ATM can be very challenging. It requires an internet connection, as well as access to the power grid. For this reason, they are often found in public places or at locations where both of these resources can be accessed freely. The internet connection is required to access Bitcoin’s blockchain and log the new transaction(s).
It is not entirely abnormal to see Bitcoin ATMs and think they are the same model as one finds at a bank. Several units around the world are repurposing traditional ATMs running completely different software. This approach is taken purposefully, as it should put customers at ease with this new system.
Some Things to Consider
Convenience always comes at a cost, especially in the cryptocurrency world. Bitcoin ATMs are no exception in this regard. While they make it easier to buy (and/or sell) Bitcoin quickly, there are always fees to take into account. The current transaction average is roughly 6%, but some machines may charge double. Always explore the fees first before making any commitments.
Second, there are the KYC and AML requirements to take into account. Although most Bitcoin ATMs will not ask for an ID scan when purchasing small amounts, these machines are heavily regulated. Limits for deposits and withdrawals are in place around the world. Lifting these limits requires passing a KYC check more often than not.
Easy to Spot in Some Regions
To date, there are 11,689 Bitcoin ATMs to be found all over the world. A remarkable number, but one that needs to keep increasing to make a lasting impression. Currently, these teller machines are only found in 70 countries. That is not enough to take Bitcoin to the next level.
It will not come as a surprise that most Bitcoin ATMs are found in the US and Canada. Europe is also noting solid growth, whereas Asia and primarily Africa continue to lag behind. There is still a lot of work to be done, but it is an interesting industry segment worth keeping an eye on.