Bitcoin ATMs and what you need to know about them

Many people invest in cryptocurrencies, especially Bitcoin (BTC). With its acceptance and popularity on a global scale, many coin owners wonder how they can transact easier. Gladly, there are many Bitcoin ATMs that can now be found in several different places. 
 

Even if BTC doesn’t have a physical form, some people wish to access it through regular ATMs. This is most helpful for people who don’t have a stable network that will help them access their assets. 
 

For those who aren’t that familiar with Bitcoin machines and often wonder ‘how does a Bitcoin ATM work?’, here are a few facts to learn more about them: 

What are Bitcoin ATMs? 

As the name suggests, Bitcoin ATMs allow people to conduct transactions in BTC and not in fiat. These are called BTMs that also come in the form of kiosks that are placed in various locations. With these, people can buy BTCs using their debit or credit cards. Some also allow users to sell BTC for cash. These look like traditional ATMs, except they don’t dispense anything physically. 
 

A BTM has a monitor, QR scanner, bill acceptor, and dispenser. These components are connected via software on the backend to make buying and selling Bitcoin fast, convenient, and secure.
 

Unlike the usual ATMs, they are not linked to a bank account. Instead, they use the internet to connect directly to a Bitcoin exchange. Users can purchase and sell Bitcoin instantaneously through these exchanges.
 

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How it started 

The first BTM opened on October 29, 2013 in Canada’s Waves Coffee Shop in Vancouver. However, it only operated until 2015 as it had errors from Bitstamp. Aside from that one in Vancouver, another BTM that opened in 2013 is in Bratislava, Slovakia. Meanwhile, the first BTM in the United States opened in 2014 and was installed in Albuquerque, New Mexico. However, it was pulled out a month after. 
 

There were several issues concerning BTMs, especially when it comes to regulations. Soon enough, there had been laws that adhere to the legalities of BTMs highly similar to that of ATMs. 
 

As more and more BTMs emerge, some people tend to ask the question ‘Can I own a Bitcoin ATM?’. Impressively, the answer to that is yes, especially if they can comply with all the requirements. 
 

For example, all BTM operators in the US should be registered with the Financial Crimes Enforcement Network (FinCEN). They should also follow the Bank Secrecy Act's (BSA) Anti-Money Laundering (AML) regulations. This somehow appeases the curiosity of those who ask ‘are Bitcoin ATMs safe?’. 
 

Currently, there are thousands of BTMs around the world. Most of them are located in the United States while some are found in cafes, specialty shops, railway stations, and even airports. 
 

To those who are curious about ‘how much does a crypto ATM cost?’, the answer to that is a little uncertain since it all depends on the exact location, the licenses, and the cost of the actual machine. It may also depend on the regulations of the country when it comes to setting up one. 

How it works

For those who wonder how does crypto ATM work, they transfer cryptocurrency to a user's cryptocurrency wallet, which the user can identify by scanning a unique quick response (QR) code into the machine. Although most BTMs provide a real-time conversion rate, they also charge a fee for the convenience of the transaction.
 

A machine's rate may have a greater financial impact on transactions than the fees themselves. This is why transactions may be slightly more expensive on BTMs than on typical exchanges.
 

While the majority of machines do not discharge anything, some newer machines have started to do so as a new function. Users can then check their crypto wallets to confirm their purchases. This, however, could take several minutes to complete.
 

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How to use Bitcoin ATM 

People often wonder how to use Bitcoin ATM and it’s pretty simple. Still, it is important that people would first have to have an account with the BTM operator. This will make transactions easier.
 

Also, users need to have their crypto wallets ready. That way, they can easily record all their transactions with the help of their smartphones. Once these steps are accomplished, users can visit the nearest BTMs and follow these simple steps: 
 

1. Input phone number
   BTMs require verification. They do this by asking users for a verification code before they proceed with their transactions. This is important so that people can comply with Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations.
2. Verify identity 
   After receiving the code via text message, they would have to input it into the machine. This was placed to prevent people from placing fake numbers into the BTMs.
3. Scan wallet QR code 
   Those who use BTMs are likely to have Bitcoin addresses already as this is where the BTCs will be sent. If there is none yet, it is best to get one first. Then, the user should use the QR code and scan it on the BTM to have their crypto wallet addressed.
4. Insert fiat currency
   After the account has already been recognized, people will have to insert a certain amount of money that would be exchanged for BTC. Users can simply input the money through the designated receptacle. After that, the machine will also show the equivalent amount of the inserted fiat to BTC.
5. Confirm the amount to complete the transaction 
   Upon placing the right amount of money and double-checking all the information, people can easily press ‘Buy’ or ‘Confirm’. This will then send the money to the user’s BTC address.

How to sell BTCs in a Bitcoin ATM 

Aside from buying BTCs, people can also sell BTCs through these BTMs. Here are the simple steps to do so: 
 

1. Choose the desired option and click ‘Sell BTC’ to cash out.
2. Scan the wallet QR code or enter the address manually.
3. Verify the identity. This may vary depending on what the country requires. Some BTMs require a valid ID, phone number, photo, or fingerprint. This is commonly down for accounts that will engage in large transactions.
4. Send the crypto to the specified address. This can be done by scanning a QR code. Some machines will issue cash immediately while some will have to wait for a while.
5. Confirm the transaction and wait for the machine to have it completed.
6. Keep the receipt. 
    

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Advantages of using a Bitcoin ATM 

There are a lot of advantages that come with using a BTM. Here are some of them: 
 

• Convenient

BTMs provide convenience to users who use them as they can easily buy or sell crypto on the spot. All crypto transactions can be made easy with these machines, especially if people already have QR codes. 

• Speed 

To those who are wondering ‘how long do Bitcoin ATM transactions take?’, the answer is simple. It is fast because every transaction can be completed in a matter of minutes, around 15 at most. 

Usually, some people grumble about the slowness of cryptocurrency transactions due to verification and other online procedures that may take a while. However, it is by using a BTM that people can circumvent this issue. 

• Privacy

When using BTMs, there is no need for a third party. As a result, all digital currencies are safer since no one can take advantage of the transactions. Given that it proves how secure it is to use one, more people become inclined in trying it.

Disadvantages of using a Bitcoin ATM 

Several disadvantages come with using these BTMs. Here are some of them:
 

• Availability

Though there may already be a lot of machines available, the number of BTMs is still relatively few to accommodate all users around the world. This can be a problem for those who live in areas that don’t have BTMs. 

• Transaction fees

According to current estimates, BTMs charge an average of 10% for every transaction. This is relatively higher compared to the usual fees of regular transactions. Though it may be more expensive, it somehow becomes reasonable for the convenience it provides. 

• Risk of errors 

BTC transactions are known for being faultless. However, it can’t be denied that BTMs are powered by technology too. Just like traditional ATMs, they are at risk of suffering from malfunctions, cash depletion, or other types of error. There is also a chance the machine becomes offline.

FAQs 

Got some more questions in mind? Here are some of Gamdom’s answers to the common inquiries about BTMs!
 

• Are BTM transactions anonymous?

Though the machines may require verification, it is guaranteed that people can still enjoy anonymous transactions from the machines. 

• How much can be deposited at a BTM?

It depends on the machine since each of them tends to have different limits. Still, some machines tend to set the maximum transaction amount to $3500. 

• How can one find a BTM?

Once people have an account, they can find a machine by plugging in their location. This will make them receive a list of nearby BTMs with exact addresses and operating hours. 

• Aside from BTC, do BTMs support other coins?

It depends on the machine. However, most machines support other altcoins such as Litecoin (LTC), Ether (ETH), Dogecoin (DOGE), Tether (USDT), and several others. 
 

These are just some facts that people would have to know about Bitcoin ATMs and what makes them special. 

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Words: Kyra Jimenez