A Bitcoin ATM is a kiosk that allows a person to purchase Bitcoin by using cash or debit card. Some Bitcoin ATMs offer bi-directional functionality enabling both the purchase of Bitcoin as well as the sale of Bitcoin for cash. In some cases, Bitcoin ATM providers require users to have an existing account to transact on the machine.
There are two main types of Bitcoin machines: cash kiosks and ATMs. Both types are connected to the Internet, allowing for cash or debit card payment, respectively, in exchange for bitcoins given as a paper receipt or by moving money to a public key on the blockchain. Bitcoin cash kiosks look like traditional ATMs, but do not connect to a bank account and instead connect the user directly to a Bitcoin exchange. Bitcoin-enabled ATMs are traditional ATMs and connect to a bank account to allow for a cashless purchase of bitcoin. According to an advisory issued by the Consumer Financial Protection Bureau, “they may also charge high transaction fees – media reports describe transaction fees as high as 7% and exchange rates $50 over rates you could get elsewhere”.
On October 29, 2013, a Robocoin machine opened in the Waves coffee shop in downtown Vancouver, Canada. This machine is understood to be the world’s first publicly available Bitcoin ATM. Robocoin ceased operations in January 2016. The first machine in the United States went online on February 18, 2014, in a cigar bar in Albuquerque, New Mexico. It was removed 30 days later. In April 2014, Coinme became the first Bitcoin ATM provider with a money transmitters license installing a unit in Belltown in Seattle, Washington. A New Zealand bitcoin machine operator announced in 2014 they had to shut-down operations due to interference with banks. On December 8, 2013, Europe’s first Bitcoin ATM was installed in Bratislava, Slovakia.
Bitcoin machines are not yet regulated in Canada, however regulations have been officially proposed for all bitcoin exchangers. In February, 2014, the Canadian Finance Minister mentioned plans to introduce anti-money laundering and anti-terrorist financing regulations for virtual currencies such as Bitcoin. The Canadian Department of Finance circulated a draft of the proposed regulations in June 2018, but the law is not in Regulations or in-effect as of January 2019.
According to Coin ATM Radar, there are more than 2,342 Bitcoin ATMs in the United States as of January, 2018, with small shop owners earning a reported $300 a month for rental space. Transactions fees for ATM use are approximately 16 percent, while online transaction fees run about 7.5 percent. Part of the bitcoin ATMs operating in the US is imported from all over the world, for example from Prague. Czech company General Bytes has placed its machines in Las Vegas among other american cities.
Bitcoin ATM operators need to adjust the limits on deposits and withdrawals according to AML/KYC standards applicable in the jurisdiction where their ATMs are placed.[better source needed] In some countries / states this requires a money transmitter license.
Media related to Bitcoin ATMs at Wikimedia Commons
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