Reuters‘ recent report revealed that bitcoin ATMs have started to appear at several corners in America. Just as the name suggests, bitcoin ATMs allow customers to buy or sell digital currency. Sometimes, they also provide hard cash.
Bitcoin ATMs: how it started
According to Reuters, bitcoin ATMs are now spread in almost every state. Several states that might not have the ATMs yet are Alaska, Washington, and D.C. The growing popularity of these ATMs is suspected to come from bitcoin’s growing popularity as well as its prices.
Compared to last year, the number of bitcoin ATMs through the United States have multiplied. Las Vegas-based Coin Cloud alone recorded 1,470 machines around the United States. The CEO, Chris McAlary, expects the number to grow more or less 10,000 more by the end of the year. Apparently, the pandemic is not holding the business. Instead, the company noted an increase in foot traffic during lockdowns.
Similarly, Atlanta-based Bitcoin Depot’s ATMs have grown more than twice the previous year’s tally. CRO Brandon Mintz said that the company currently has over 1,800 machines installed. Their customers range from 25-40 years old, which utilize online platforms to find the ATMs.
Despite the outgrowing numbers of bitcoin ATMs, not every company managed to thrive from the bitcoin frenzy. Quad Coin’s Shoiket reported to have not generated profit within six months. As a result, the company had to uninstall roughly 200 ATMs.
How the ATMs work
These ATMs offer different services depending on the type. Some ATMs are limited to bitcoin, while some also give other digital currencies options. Some others can be used to withdraw cash, though most of the times it cost more than regular ATMs. Director of financial investigations and education at cryptocurrency compliance firm CipherTrace, Pamela Clegg, mentioned that these ATMs charge from 6% to 20% of a total transaction. The fees differ according to location and the ATM operator.
Why do people opt for bitcoin ATMs? The reasons vary. These ATMs could be helpful for people with a lack of bank accounts, those who are looking to send remittances abroad, or those who seek anonymity.
Accordingly, government agencies have alerted people over these machines. The concerns arise mainly due to the cost of these machines and the potential for illicit activity. Last February, The New Jersey State Commission of Investigation even detailed some of those concerns through a report titled “Scams, Suspicious Transactions and Questionable Practices at Cryptocurrency Kiosks”. The bitcoin ATM industry, however, remains to grow stronger, still.
Read also: The Value of Bitcoin Has Reached $1 Trillion
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