Explained: What are Bitcoin ATMs, significance and concerns associated with them?
Bitcoin ATMs: Why in News?
Bitcoins ATMS are coming near you and one can find them as close as the nearest gas stations. This was reported by many news papers and media houses across the United States recently.
Bitcoin ATMs were found at many smoke shops in Montana gas stations in Carolinas and New York city . The price of bitcoin has risen over 58000$ in the past year.
What is a Bitcoin ATM and how does it work?
- A cryptocurrency ATM or a Bitcoin ATM looks similar to the normal one and is usually used to either exchange cryptocurrency or can also be used to withdraw money sometimes.
- This means the consumers can load or unload cash so as to buy or sell digital currencies like Bitcoins on the ATMs.
- By January 2021, there were 28,185 bitcoin ATMs in the United States, as informed by howmanybitcoinatms.com, an independent research site. Roughly 10,000 came within the prior five months.
- The ATMs have been installed by Kiosk operators like Coinflip, Coin Cloud etc. “I just assumed there was demand and people wanted bitcoin everywhere,” said Quad Coin founder Mark Shoiket.
Take a look at some pictures of Bitcoin ATM below.
Why is there a demand for Bitcoin ATMs?
- Bitcoins have seen a high rise in demand in the past few years.
- Thus its gaining popularity is the reason behind installation of many such ATMs. Many citizens of the USA have openly suggested their usage of Bitcoins when out of cash.
- The reason why people prefer ATMs rather than online transactions may vary.
- They may range from many getting paid in cash while others lack bank accounts. Some want to send remittances abroad while others want anonymity in their transactions.
- The rise in ATM popularity is more than 45% in the past years.
- Many citizens feel more comfortable interacting with a physical machine.
- COVID 19 was expected to cut short the foot fall to the ATMs but it rather resulted in an increase of population in ATMS.
Types of Bitcoin ATM Machines:
- Some machines only offer bitcoin, whereas others allow the customers to invest in various digital currencies.
- There are also a few bitcoin ATMs that can actually spit out cash. However, they cost more than regular ATMs or even online transactions.
- Fees range from 6 percent to 20 percent of a total transaction.
- The stimulus payment distributed in the USA has been used by people to buy cryptocurrency thus creating a high demand for Bitcoins.
Concerns about Bitcoin ATMs:
Government agencies have raised red flags about some machines because of their cost and the potential for illicit activity. Even the cryptocurrency is not accepted at many places in the world. Many people call it scam, suspicious transactions and questionable practices at cryptocurrency kiosks. However none of the concerns raised have been helpful in controlling the growth of this industry.
India also got its first Bitcoin ATM in Bengaluru's Kemp Fort Mall in October 2018. India's Banking Regulator does not recognize Bitcoins. Even the Finance Minister said that not all windows would be shut for cypto currency .