What Is A Bitcoin ATM?
As taken from the term ATM – the automatic teller machine, Bitcoin ATMs operate using the same concepts as any other fiat automated teller machine where users can physically cover their withdrawals, deposits, and transfers across the device, the Bitcoin ATM was designed under a similar concept with a different idea. Rather than focusing on the physical form of accessing funds through the machine, the users are provided with various options for trading Bitcoin (BTC) in exchange for cash, securely and conveniently.
All transactions accessed through the BTM are first processed on the blockchain, which sends cryptocurrencies to the users’ digital wallets. While covering everything from the blockchain, these machines utilize QR codes for processing the tokens across the digital wallets. The complete execution of the process requires an internet connection, which is made for all BTMs present worldwide.
Overviewing the Existence of Bitcoin ATMs In The Current Digital Trends
While explaining the mechanism of how a Bitcoin ATM processes in the market, multiple forms are currently provided to the user base in the world.
Bitcoin automatic teller machines that only offer buying options are recognized as a unidirectional BTM, while the BTMs which are providing buying and selling options simultaneously are referred to as bidirectional BTMs.
As it keeps up with the idea of the decentralized operation of digital assets, Bitcoin ATMs are not operated by any financial institutions. They are not connected with any bank account to process the payments. The idea of Bitcoin machines is to provide autonomy to the user in making their sales and purchases in the digital asset while being present anywhere in the world, exempting the unnecessary barriers of the existing payment systems.
Development of Bitcoin ATMs In The Current Market
Bitcoin ATMs have been recognized and encouraged across the consumer market. Almost 14,000 BTMs have been installed worldwide, covering 9,000 kiosks of BTMs in the United States. As this service became extremely popular in the market, the question has been directed towards the utility it presents in the future. Although this idea is being criticized in the market, determining the right standard for Bitcoin ATMs is still to process.
Considering the concept of decentralization in cryptocurrency, Bitcoin machines are not bound to be produced and installed under any company label. Although this is an exceptional method of getting into cryptocurrency, the compromised security from the existence of these machines marks a question for the sustainability of the product according to the country’s regulations.
The think tanks behind the concept are working on changing the current dynamics to find an answer to what Bitcoin ATMs can achieve in the digital market with their proficient usability. Bitcoin ATMs have been installed in great numbers; however, to make this global, it is necessary to cover all the countries’ concerns that involve the need to store KYC information for record management across these machines. There is still a lot to see in this field, despite the regulations put up by different authorities in the current market.
How Bitcoin ATM Works
As you have found the answer ‘what is a Bitcoin ATM machine?’, let’s see how Bitcoin ATMs work. The working of a BTM Bitcoin ATM is similar to any other ATM machine installed in your vicinity. The only difference is that there is a camera scanner installed in the machine which can be used to scan QR codes from your mobile screen. A BTM Bitcoin ATM provides three following facilities.
- Buy Bitcoin (BTC)
- Sell Bitcoin (BTC)
- Redeem Bitcoin (BTC)
There are usually three categories for selling and purchasing BTC which depend on the size of the transaction which you want to execute. Like fiat withdrawals from normal ATMs, BTM Bitcoin ATM also notifies users of their activity through SMS. This feature provides ease of mind as it is an extra security measure.