A Bitcoin ATM is a quick and easy way to buy Bitcoin with cash or a debit card. They are the next step towards the adoption of cryptocurrencies worldwide, but how do they work and should they be used? What advantages do they offer over an exchange or a peer-to-peer service like LocalBitcoins? Here are the important facts.
What is a Bitcoin ATM?
Bitcoin ATM (ATM) allows you to buy Bitcoin and sometimes perform other blockchain operations in a physical kiosk. This could be in a local store, mall, or other location used by the general public. Some Bitcoin ATMs support two-way functionality, whereby you can sell Bitcoins and withdraw funds to your bank account or cash through the machine itself. In exchange for cash or digital funds, you will receive Bitcoin to your wallet address or a printout of your paper wallet.
One of the biggest advantages of buying Bitcoin through an ATM is speed. It depends on the machine, but often the transaction starts as soon as you have enough funds. It may take as little as 15 seconds, but if you have a lot of wallets to enter, it may take longer. Most ATMs accept cash or debit cards, but since most banks block cryptocurrency purchases using credit cards or other purchase options, you won't be able to make a purchase using alternative payment methods.
Many Bitcoin ATMs connect to an exchanger or exchange. These exchanges allow you to trade and ensure that you can get your bitcoin as quickly as possible. You don't interact with another person who wants to sell, so you don't need Escrow accounts, lawyers or contracts. Because of this, the convenience factor and the cost of operating a local machine, the fees for bitcoin ATMs are often excessive. An average commission of $ 50 or roughly 16% of the transaction amount is not unusual.
Since these machines often run on exchanges, you may need to create an account or use an existing account to make a purchase. While some Bitcoin ATMs allow anonymous transactions (especially for small purchases), this is a less common feature. Even if you don't need to be verified (KYC), you still need to pay in cash to stay anonymous.
How to use Bitcoin ATM?
Bitcoin ATMs vary in quality, characteristics and manufacturers, but often work the same way:
- Choose a payment method and the total number of bitcoins to buy
- Complete payment
- Scan the QR code of your wallet (if you already have a Bitcoin wallet)
- Collect a paper wallet (if you do not already have one)
Bitcoin ATMs can have limits on the total amount of cash you can buy, the total amount of available bitcoins, KYC requirements, and more. Bitcoin ATMs almost always have a video surveillance system, which comes with potentially a lot of money.
If you don’t know how to operate a particular machine, or if you have a problem, a store operator is often near you who can tell you what to do next or suggest a potential solution.
Is it risky to use a Bitcoin ATM?
Given the prevalence of card cloning devices in the debit / credit card market, you may be concerned about the security of any Bitcoin ATM. What if the car is hacked? What if he steals my money during my transaction without giving away the bitcoins?
The risk associated with any Bitcoin ATM varies by machine and location. If you are in a residential area of the city, you may need to be more careful than in the central area. Carrying a large amount of cash can get unwanted attention, especially since anyone using a Bitcoin ATM is likely to have a good amount of money. Thieves can chase people who use the car.
Similarly, a card skimmer may be attached to a Bitcoin ATM, or someone may steal your new paper wallet. When using a Bitcoin ATM, you should be extremely careful. Always ensure that you work in a well-lit area with a clean and functional ATM. You do not know how well the machine works, but if it is in a clean condition in a clean environment, you will have less problems than with a dirty old machine covered with graffiti.
The cybersecurity aspect is more difficult to verify. Researchers recently discovered a potential Bitcoin ATM malware designed to dispense cash from a machine. While this affects the owner / operator of the ATM and not you, it raises concerns about their digital security. If they can become infected in such a way that bad people could withdraw cash at will, what could prevent them from taking your bitcoins? What's stopping a hacker from transferring your bitcoins to their account and giving you an empty wallet?
While most cars have alarms, you can use a car that you already have an exchange account on. This limits the potential for harm during any attack. The exchange or exchange office serving the ATM can send funds to the address of your wallet, which is already specified in the file, instead of creating a new account and performing a transaction on the network.
Where is my nearest ATM?
The best way to find the nearest Bitcoin ATM is an online service Coin ATM Radar ... This free service uses your location (or an address of your choice) to display the nearest Bitcoin ATMs to you.
This service displays the name of the store, the distance from your location, general fees and any daily vehicle limits. It shows details for several cryptocurrencies including Ethereum и Litecoin... It also shows user feedback on the state of the machine if the machine is turned on or not, as well as the opening time and the manufacturer of the machine.
Start using a Bitcoin ATM today!
Now that you know what they are and how they work, will you start using a Bitcoin ATM machine? Is there even one near you? We'd love to hear your thoughts on Twitter, so join the discussion.