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WTF Does A Bitcoin ATM Do?

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@StealthEX.ioStealthEX.io

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What Is A Bitcoin ATM? Bitcoin ATM (sometimes also called BTM) is a kiosk that is used to buy BTC for fiat money or, in some cases, even to cash out cryptocurrency (about a third of all BTC ATMs). 

The first Bitcoin ATM came out in 2013 in Vancouver, Canada, and since then there are over 8000 such machines installed in more than 75 countries around the world. Some BTC ATMs allow not only to operate with BTC but also with some amount of altcoins (i.e. Dash, ETH, Dogecoin etc.).

How Bitcoin ATM Works?

BTC ATM often consists of a scanner, a cash dispenser, and a computer for managing transactions. It will be easier to perceive BTM as a “relative” of terminals for refilling the mobile balance. To make a transaction BTC ATM connects with the Bitcoin blockchain via the Internet and gives the user the address to which the cryptocurrency is transferred. Bitcoins are issued either to the buyer’s bitcoin wallet (via a scanned QR code on a mobile device or on a paper wallet) or to the paper wallet itself, generated and printed by the ATM at the time of purchase.

Bitcoin ATM Fee

How much does Bitcoin ATM charge? The purchase price depends on the current rate that the ATM receives from the Internet in real time. In addition, the ATM charges an additional service fee and takes into account its cost. The commission depends on the pricing policy of an operator. In most cases, it is 7-9% of the transaction amount. Take into account that BTC ATM doesn’t accept credit or debit cards and this is made on purpose. Using a credit/debit card user may request chargeback but this is impossible as transactions in BTC blockchain can’t be canceled. Anyway, there are a few ATMs that still enable using cards. 

How To Use A Bitcoin ATM?

So how does a Bitcoin ATM works? While each BTM is different, the buying process is basically the same. Let’s have a look at common steps to make an operation:

  1. Select “Buy Bitcoin”.
  2. Scan the QR code of BTC address with the BTC ATM scanner.
  3. Depending on the BTM and jurisdiction, you may be required to provide identification (KYC).
  4. Enter the amount you want to purchase.
  5. Insert money into BTM.
  6. Wait for the machine to process the transaction.
  7. Check your Bitcoin wallet to confirm the transaction.

The process is much more varied and depends on the specific ATM, however, these machines are quite intuitive to use, so you can just follow the instructions on the screen.

Where Is The Nearest Bitcoin ATM?

If you decide to use BTM you’ll have a relevant question: Where is the nearest BTC ATM located? There are many resources and applications on the network that track the Bitcoin ATM location and find the closest Bitcoin ATM.

A complete list of Bitcoin ATMs around the world, provided on the resource Coin ATM Radar. You can just find your location and see where the nearest BTC ATM is located. The map also allows you to search for altcoin ATMs if you want to buy/sell other cryptocurrencies. The website also provides you with a lot of ATM details such as fees, limits, whether cryptocurrency buy-only, sell-only, or both are available, and will guide you from your location to the nearest Bitcoin ATM.

As each BTM charges a specific commission per transaction, which varies from one to another, make sure you are aware of the terms that are usually indicated on the machine. 

Are Bitcoin ATMs Anonymous?

Are Bitcoin ATMs anonymous? – you may ask. It mostly depends on the legal requirements of the country where the Bitcoin ATM is installed. In some jurisdictions, they can be used anonymously. In most cases, the ATM camera takes a picture of the user’s face, but sometimes it is required to show the ID to the camera. But even with the possibility of anonymous use of BTC ATM, it is impossible to talk about the complete anonymity of Bitcoin: if you have the desire and resources, all transactions can be tracked, and the wallet can be connected with a specific person.

 Are Bitcoin ATMs Safe?

Often, along with the question of anonymity, comes up the question of the safety of using BTC ATM. Here, as with a regular ATM, you should always beware of suspicious characters scurrying around nearby. Attackers can track people down at BTMs, as they will most likely have at least some cash. Although most of the devices are equipped with a camera, and almost all of them are located inside shopping centers or shops. There are guards and other security measures. In addition, no operator wants its BTM to be damaged, so Bitcoin ATMs are most often placed in neighborhoods that are considered safe.

Bitcoin ATM Operators

As it can be understood from above, each BTC ATM is managed by an operator. Hereunder we will consider some of such operators.

  1. General Bytes is a Czech company that is the world’s largest manufacturer of Bitcoin ATMs and other altcoins. Their ATMs can support over 120 different fiat money and over 60 different cryptocurrencies.
  2. Genesis Coin Inc. is located in San Diego, USA, and is the second most popular ATM manufacturer. The company supplies three different BTM models: Genesis1, Satoshi1, Finney3.
  3. Lamassu is a Swiss company and also the oldest manufacturer of BTMs (since 2013). Lamassu machines are open source and support Bitcoin, Zcash, Ethereum, Bitcoin Cash, Litecoin and Dash.

What are the advantages and disadvantages of Bitcoin ATM machine?

BTC ATM Advantages

  1. One of the main pros of a Bitcoin ATM is the ability to buy BTC for cash very quickly.
  2. Transaction speed. The process usually takes a minute or less – about the same as working with a usual ATM.
  3. Easy to use. BTM functions almost as a simple ATM. You just need to keep up with operating instructions on the screen.

Bitcoin ATM Disadvantages

  1. Pretty high commissions. As was said above, it can vary from 7% to 9% of the total transaction amount.
  2. Physical accessibility. There is no BTM in every city or district, and they are often located too far from each other.
  3. Poor technical support. If there are some issues or bugs while working with BTM, it can take several weeks before a broken ATM is fixed. In such cases, users are often left alone with the problem and must check by their own whether the transaction was successful or not.

To conclude, Bitcoin ATMs are a very convenient way to buy and even sell BTC very fast and sometimes anonymously. While most BTMs work more or less the same, it is always a good idea to check the fees of the BTM you plan to use. BTC ATMs have been improved since their first appearance and have become much more convenient to use. Their sustainable development suggests that Bitcoin and cryptocurrency in overall have come to our world for a long time.

Previously published at https://stealthex.io/blog/2021/01/01/what-is-a-bitcoin-atm/

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