Bitcoin ATMs: A Beginner’s Guide to Bitcoin ATMs
A Bitcoin ATM or BTM (Bitcoin Teller Machine) is a popular means of bypassing the traditional banking system of buying or withdrawing Bitcoin ( BTC ). Its popularity has grown over the years along with the increase in the value of cryptocurrencies and the increase in the level of trust in them.
Other ATMs allow users to buy and/or sell other cryptocurrencies such as Ether ( ETH ), Bitcoin Cash ( BCH ), Dash (DASH), and Litecoin ( LTC ), among others.
If you haven’t used one yet or would like to know more about them, keep reading. In this article, we will talk about some interesting points about Bitcoin ATMs. We will also provide you with useful information, such as typical requirements and steps to consider when buying or selling Bitcoin.
We will also answer questions such as how to deposit money at a Bitcoin ATM. How much does it cost to use a Bitcoin ATM?
What is a Bitcoin ATM, or BTM?
An ATM or BTM is similar to a regular ATM in that it is a physical kiosk. What sets it apart from typical ATMs, of course, is that it allows users to buy Bitcoin in exchange for cash or debit. Some BTMs also allow users to sell Bitcoin for cash.
How To Use Bitcoin ATM? BTMs resemble typical ATMs. However, they connect to a Bitcoin wallet instead of a bank account. Instead of a bank card, the Bitcoin wallet serves as a repository from which coins are sent or loaded. Some Bitcoin ATMs look very similar to traditional ATMs because they are actually traditional ATMs with software adapted to Bitcoin.
A Brief History of Bitcoin ATMs
The first cryptocurrency ATM opened for the first time on October 29, 2013. It was a Robocoin ATM located at Waves of Canada coffee shop in Vancouver. It only worked until 2015 due to Bitstamp bugs, but it is widely recognized as the world’s first Bitcoin ATM. Shortly after, a Bitcoin ATM was opened in Europe. It was located in Bratislava, Slovakia, and was installed on December 8, 2013.
Meanwhile, the first Bitcoin ATM in the United States was installed on February 18, 2014 in Albuquerque, New Mexico. However, it was short-lived and was withdrawn after only a month of operation.
Like the cryptocurrency itself, Bitcoin ATMs have since faced many regulatory issues. Eventually, a consensus was reached agreeing that Bitcoin ATMs also had to abide by the same laws and regulations as traditional ATMs.
This includes limits on the number of deposits and withdrawals one person can make per transaction, per day. For example, in the United States, all Bitcoin ATM operators must register with the Financial Crimes Enforcement Network (FinCEN) and follow the anti-money laundering regulations of the Bank Secrecy Act (BSA).
The Bitcoin ATM may need your mobile phone number to send you a text verification code depending on the amount of the transaction. Before completing a transaction, you may be required to scan a government-issued ID, such as a driver’s license.
Also, to the dismay of many cryptocurrency enthusiasts, many Bitcoin ATMs no longer offer the anonymity they once did. This is due to current regulations that require users to verify their identity before making transactions, especially when dealing with large amounts.
There are currently about 28,000 Bitcoin ATMs around the world, most of them located in the United States. North America has the largest Bitcoin ATM market share globally, at almost 90%. Currently, the largest Bitcoin ATM manufacturers are Genesis Coin (41.5% market share) and General Bytes.
Most BTMs are found in cafeterias or specialty stores, as well as transportation hubs like train stations and airports. Typically, business owners who want to have a BTM installed within a commercial space will need to sign a contract with a Bitcoin ATM provider. The supplier will be responsible for installing the device on-site.
How does a Bitcoin ATM work?
Unlike online cryptocurrency exchanges, Bitcoin ATMs make it easy to buy and sell Bitcoin. Bitcoin ATMs generally require users to have an existing account in order to use the machine.
The two types of Bitcoin or BTM ATMs are:
One-Way Machines: One-way transaction machines that support both the buying and selling of cryptocurrencies.
Two-way Machines: Two-way machines that support both the buying and selling of cryptocurrencies.
BTMs need to be connected to the internet in order to exchange cryptocurrencies for cash. BTMs typically move money via a public key on the blockchain, while some continue to use paper receipts. Bitcoin ATMs also often require a verification process, especially when large amounts of transactions are being made.
Unlike traditional ATMs, which allow you to physically deposit and withdraw funds, Bitcoin transactions are based on the blockchain. They send cryptocurrency to the user’s Bitcoin wallet via a QR code. Since they are not connected to a bank account, they are also not operated by large financial institutions. However, as we have mentioned, they adhere to similar laws and regulations.
Usually, users will be asked to scan a QR code that corresponds to their Bitcoin wallet address. Afterward, the purchased coins can be transferred to your wallet. A record of the transaction will appear in the user’s digital wallet after a few minutes of processing.
There are also maximum and minimum limits for the money that can be deposited through a BTM. In the United States, all Bitcoin traders are required to register with FinCEN. They are also subject to the AML clauses of the Bank Secrecy Act (BSA). The Bitcoin ATM may need your mobile phone number to send you a text verification code depending on the amount of the transaction. Before completing a transaction, you may be required to scan a government-issued ID, such as a driver’s license. gate automation