There are ~34,000 Bitcoin ATMs globally. At the start of 2021, there were ~14,000. That is ~20,000 Bitcoin ATMs being installed in a year!
Before we tackle the question, “how does a Bitcoin ATM work?” we need to understand why they are being installed in the first place at such a rapid pace. With so much of the population unbanked or underbanked, Bitcoin offers the ability for anyone to interact with this new financial system.
Being the grandaddy of the cryptocurrency space has its perks. As some see it as a hedge against inflation, there’s no denying Bitcoin is here to stay. To learn how to use a Bitcoin ATM and why you may want to, enjoy our blog below bit by bit.
What Is a Bitcoin ATM?
A Bitcoin ATM is a lot like a traditional ATM, the main difference being you’ll be buying and selling bitcoin (BTC) rather than fiat (USD). With a traditional ATM, your deposit and transfer funds to and from a bank account. With a Bitcoin ATM, blockchain-based transactions take place to and from a Bitcoin wallet.
When you spot a Bitcoin ATM in the wild, they will either be unidirectional (buy-only) or bidirectional (buy and sell).
How Does Bitcoin ATM Work?
When pondering, “how does a Bitcoin ATM work?” you may be surprised that the name is a bit misleading. You are interacting with an exchange in real-time.
To start using a Bitcoin ATM, you’ll need a Bitcoin wallet. For convenience, you can download one to your smartphone. If you’d like more privacy and security, consider getting a hardware wallet to store your bitcoin and other cryptocurrencies.
Decide on how much bitcoin you’d like to purchase and select “Buy.” Once prompted, display your bitcoin public address (QR code). This will tell the Bitcoin ATM where to send the bitcoin.
Alternatively, when you wish to sell bitcoin for cash, enter in how much you’d like to sell first and click “Sell.” When ready, scan the QR code on the screen. This will initiate the sale, and in no time, the BTM will dispense the cash.
Bitcoin ATM Locations
Finding a Bitcoin ATM won’t be an issue. You have one or multiple in your neck of the woods already! You’ll spot them where you’d find traditional ATMs in places like gas stations, bodegas, airports, strip malls, liquor stores, and head shops.
To find a Bitcoin ATM near you, click here.
Identification and Fees
Originally, you didn’t need to prove who you were to purchase bitcoin at a Bitcoin ATM. These days with so much regulation on cryptocurrency, Bitcoin ATMs have KYC and AML laws to adhere to. All are regulated by FinCEN (Financial Crimes Enforcement Network).
You will also need to pay a service fee for the transaction. This will most likely be a percentage rather than a fixed price.
Bitcoin and Beyond
Now that we’ve answered the question, “how does a Bitcoin ATM work?” what’s next. As you’ll discover with Bitcoin and cryptocurrency, there is an endless amount of research to unpack. See, this is a new way of interacting with money and discovering what decentralization can do for you, friends, and family.
Not sure where to start? Lucky for you, you’re in the right place. Check out our blog posts on finances, crypto, and the like.
