HOW DO BITCOIN ATMS WORK?

Bitcoin ATM

Bitcoin from the day very beginning is mainly seen as a digital asset. Thanks to bullish crypto run in 2017 that took BTC from 900 $ to 20,000 $ many mainstream use cases started popping up. In this article, we will see one such use case i.e. Bitcoin ATMs. Bitcoin ATMs are no more a buzz word, installing it to your location is now seen as an excellent way to increase revenue for your business.

What is Bitcoin ATM? 

Bitcoin ATMs are machine that allows you to buy and in some cases sell BTC through automatic teller machine. Bitcoin ATM works similar to traditional ATMs but are not exactly the same as they do not connect to your bank account and instead connect the customer directly to a Bitcoin exchange for a localized and convenient way to purchase Bitcoin in person. These machines are connected to internet, allowing the insertion of cash or a credit card in exchange for Bitcoin.

Bitcoin ATM Providers

Here are top four Bitcoin ATM providers according to their market share.

  • General Bytes. Holds major share of Bitcoin ATM with 31.8%. No of ATMs sold by GB till date are 2574.
  • Genesis Coin. Second in line is Genesis coin with 30.1%  market share.
  • Lamassu. Lamassu designed and shipped first BTC ATM in 2013 and is currently standing at number third with 8.9% shares.
  • BitAccess. Available in 11 countries, BitAccess has 6.9% market share of BTM.

How Bitcoin ATM work? 

Just like traditional ATM machines, you can find following components in Bitcoin ATM.

  • Touch screen (Typically 21 inch)
  • Barcode scanner
  • Thermal printer
  • EMV card reader
  • HD camera
  • Optional cash dispenser
  • Electronic locking system

As soon as you tap screen of Bitcoin ATM, you will see an interface (as shown in following image) that allows you to buy or sell BTC.  

If you choose Buy Bitcoins, you have to enter the amount worth of which you need Bitcoin. Next scan QR code of your wallet from your cell phone against Barcode scanner on the machine and finally insert cash into the machine. Bitcoins will be transferred into your wallet and receipt will be printed out. It's really that simple.

Selling Bitcoins is as easy as buying. Choose Sell Bitcoins and then amount worth of which you want to sell Bitcoin. After that a receipt will be printed out having a QR code. You need to send Bitcoin on that QR code (from mobile). After you successfully send Bitcoins on that QR code, you will get a text message as soon as your withdrawal is ready. Tap the ATM screen again and choose redeem ticket. Scan the QR code printed on the receipt and you will be get your money.

Working with interactive Bitcoin ATM are much more simple then described above. You don't need to be  technical geek to use Bitcoin ATM. 

Bitcoin  ATMs typically charge a percentage rather than a flat fee. Buying fees for Bitcoin are 9.67% and selling costs around 6.23%.

One Way vs. Two Way Bitcoin ATMs

Depending on operations allowed, bitcoin ATMs can either be One-way or two-way. Majority of ATMs (around 70%) only support depositing of fiat money into the wallet and buying Bitcoins. They are popular as there is less legal scrutiny around them.

While remaining 30% are two-way ATMs. They support KYC and AML requirements like ID or palm scanning. This is done to prevent illegal traders (such as drug dealing), cash in on their Bitcoin.

Bitcoin ATM's around the World.

According to coinatmradar, figure for number of crypto ATM's in the world stand at 5181. These 5000 ATMs are distributed across 90 different countries with 3152 ATMs located in USA alone. 

The crypto ATM installation took an upward inclined curve in 2017. On Jan 1, 2017 number of crypto ATMs in the world were 964 which grew to 2058 on year ending. In 2018, 2053 crypt ATMs were installed while 1070  ATMs were installed in first seven months of current year (Source) and seeing the current bullish run this figure is deemed to go up. As per 17 Jul 2019, 7.1 Bitcoin ATMs are installed per day. 

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