Ever since Bitcoin and ultimately cryptocurrencies hit the limelight circa 2010. Cryptocurrencies have to continue to prove that they are here to disrupt the familiar traditional money systems.
One of such innovative steps is the Bitcoin ATM. No, this does not dispense actual coins as the Fiat ATM does. As in any booming industry, once a product launches, thousands of ancillary businesses will pop up to support that industry.
So What Are Bitcoin ATMs?
A bitcoin ATM allows customers to buy bitcoin and other cryptocurrencies. The use of “ATM” is a misnomer. The machines are not actually ATMs and do not dispense cash.
A Bitcoin ATM is not the same as the ATM that allows traditional bank account holders to deposit, transfer, and withdraw their fiat.
Rather bitcoin ATMs produce blockchain-based transactions that send cryptocurrencies to the user’s digital wallet, often via QR codes. Due to their anonymous nature, most Bitcoin ATMs have strict buying limits, with some even requiring a KYC process.
The first Bitcoin ATM opened on October 29, 2013, at Waves Coffee Shop in Vancouver, Canada. The device often comprises a scanner, a cash dispenser, and a computer to manage the transactions
Do Bitcoin ATMs Give Cash?
Some BTMs work both ways — meaning they can dispense Bitcoin in exchange for cash and they can also dispense cash in exchange for Bitcoin. However, most models work only for buying Bitcoin.
How much fee do Bitcoin ATMs charge?
Bitcoin ATMs charge an average fee of 8.93%. However, this is a rough average and the fees vary between ATMs. Make sure to read the instructions on the machine before starting the process.
How It Works.
Buying and/or selling Bitcoin using a Bitcoin ATM can be broken down into two (2) simple steps:
But first, you have to verify your identity; when a user first comes up to a machine, he or she must verify their identity. This can be done in a variety of different ways depending on the machine.
While each BTM is different, the buying process in all of them is basically the same:
Choose “Buy Bitcoin”
Scan the QR code of your Bitcoin address with the BTM scanner Depending on the ATM and jurisdiction, you may need to provide identification
Enter the amount you want to purchase
Insert cash into the BTM Wait for the machine to process the transaction Check your Bitcoin wallet for the transaction confirmation
The process of selling Bitcoins to a Bitcoin ATM is much more diverse and depends on the specific BTM, however, these machines are pretty intuitive to use so just follow the instructions on the screen.
Bitcoin ATMs are a very convenient way to buy and even sell Bitcoins very quickly and sometimes even anonymously. While most BTMs operate more or less the same,
it’s always recommended to check for the fees on the BTM you’re planning to use. Also, as a precaution, you could film your buying process so you’ll have proof if something goes wrong.