How Does a Bitcoin ATM Work
August 20, 2020
Have you heard of Bitcoin, but don’t know how a Bitcoin ATM works? Or maybe you haven’t heard of a Bitcoin ATM, at all. Well, this article is for you. We will walk you through what a Bitcoin ATM is, and help you understand how to manage one effectively and make use of its benefits. After reading this, you will be able to transact BTC using a Bitcoin ATM with ease.
What Is A Bitcoin ATM?
Bitcoin ATMs are automated teller machines which enable you to conduct transactions in Bitcoin.
Being the leading cryptocurrency, it is not surprising that Bitcoin would have its own ATM system; after all, it is a digital currency. With its increasing acceptance and integration into society, being able to use a Bitcoin ATM will be of benefit to you.
Here’s a fun fact. Bitcoin ATMs are also known as a BTMs. With this kiosk, you can buy Bitcoins by using either cash or a debit card. You can also use the BTM to sell Bitcoins for cash. Although the BTM works like a traditional ATMs, they are not the same.
BTMs have internet access which enables you to buy / sell Bitcoins with cash or debit cards.
Instead of connecting to a bank, internet access enables the BTM to connect the customer directly to a Bitcoin exchange or wallet. This serves as a convenient way to purchase Bitcoins in person. BTMs are found mostly in stores, restaurants, and airports on the east coast of Australia.
The BTM was launched for use in October 2019. Although around the world there are about 7,000 machines, this is a small figure when compared to the number of existing traditional ATMs. However, with time, there will be an increase in this number, as the benefits of these machines will become more known.
So how do Bitcoin ATMs work?
It’s a two way buy or sell process when using a BTM. To make Bitcoin ATMs work for you, fiat currencies are an option when using a Bitcoin machine. You can exchange a traditional currency to BTC by following some simple steps.
How To Use A BTM To Buy Bitcoin
There are different types of BTMs available in the market. You can find Bitcoin ATMs in Perth, Sydney, Brisbane, Adelaide and Melbourne. However, they all have the same general process of handling Bitcoin transactions. The steps involved in buying Bitcoin, using BTMs include:
- On the BTM interface, click “Buy Bitcoin.”
- Using the BTM, scan the QR code of your Bitcoin wallet address.
- Depending on the BTM, you may need to provide some identification.
- Input the amount of Bitcoin you want to buy.
- Insert your cash into the BTM.
- Wait a moment for the BTM to process the transaction.
- Click on “Finish.”
- Collect a printed receipt.
After the transaction, check your Bitcoin wallet. The steps may differ, depending on whichever Bitcoins machine you might be using. However, follow the instructions, and you should be okay.
How To Use A BTM To Sell Bitcoin
To sell Bitcoin using BTMs, follow these steps:
- On the BTM interface, click “Withdraw cash.”
- Select Bitcoin.
- Input the amount of Bitcoin you want to sell.
- Transfer Bitcoins from your Bitcoin wallet to the given address QR code.
- Wait a moment for the transaction to be processed.
- Withdraw your cash.
Reasons To Use A Bitcoin ATM
There are four main reasons why you would use a Bitcoin ATM over another transaction method. These reasons include convenience, privacy, security and trust. Like all forms of monetary transactions, these four reasons are key to the success of a platform. Remove one of them, and people quickly lose credibility with the service.
Let’s explore the four reasons to use ATMs made specifically for Bitcoin more closely.
With BTMs, you can sell or buy Bitcoin within seconds. Some BTMs allow you to create an account on the spot. All you need is a Bitcoin wallet to run transactions using a BTM. When compared to cryptocurrency exchanges, which may take up to weeks to process one transaction, BTMs are considerably faster. Even when you do not have a crypto wallet, with some BTMs, you can create one on the spot with nothing but your smartphone device. By using only your QR code or your wallet public address, transactions can happen with ease.
BTMs lets you buy and sell Bitcoins anonymously. Transactions using BTMs do not require KYC or AML. KYC means “Know Your Customer”, which refers to a set of guidelines which require your personal details for authentication. It is helpful to look at these guidelines when you want to participate in cryptocurrency as a cash service business. AML means anti-money laundering, which is a group of policies set by regulatory bodies.
The KYC mainly states that every broker or dealer should know and keep records on essential information of each customer, especially the identity of whoever has the authority to act on the person’s behalf. Transactions with BTMs prove a good way to secure the customer’s privacy. The transactions that you make with BTMs are private, meaning that only you and the recipient are aware of the exchange, and no one else.
With their anonymity feature, BTMs provides security for the customer by guarding the user’s identity. No details about your wallet are shared, and your transaction is complete within seconds.
With the ease and efficiency that comes with using BTMs, including the guarantee of security and privacy, you can trust the machines for smooth and seamless transactions. BTM machines are also typically set up at trustworthy businesses, making them accountable to an owner.
With the increase in the adoption of cryptocurrency in the world, more convenient systems of crypto transactions are needed. Hence it’s essential to know how to use BTMs with ease.
By now, you should be comfortable working a BTM for buying or selling Bitcoins anonymously. Make sure to check the BTM you are using for the charge fees, which can be around 7-10% for the majority of machines.
In case you are buying a large amount of Bitcoin, some BTMs will require you to provide your documents for scanning. Some may ask for your phone number for KYC purposes.
Although the number of BTMs in the world is low, we believe that there will soon be more BTMs built around numerous parts of the world, just like traditional ATMs. To learn more about Bitcoin and how to transact online, check out our extensive FAQ section on Zipmex.