VendingFanatic Posted October 7, 2017 Share Posted October 7, 2017 Hi, I was wondering if anyone had any advice regarding bitcoin ATM machines? Link to comment Share on other sites More sharing options...
AZVendor Posted October 7, 2017 Share Posted October 7, 2017 Since Bitcoins are virtual only, I don't see how that would work. It sounds like a scam. Link to comment Share on other sites More sharing options...
VendingFanatic Posted October 7, 2017 Author Share Posted October 7, 2017 Hmmm not sure if it's a scam or not? But, I know that there are people doing it. https://coinatmradar.com/blog/how-to-start-a-bitcoin-atm-business/ Link to comment Share on other sites More sharing options...
AZVendor Posted October 7, 2017 Share Posted October 7, 2017 That doesn't mean anyone is getting a return on their investment though so that would be a scam. How would a transaction even work? Do you withdraw virtual bitcoins to your phone? Where, then, could you spend them? If it's just a way to transfer fake money around you can do that online. Link to comment Share on other sites More sharing options...
BluePlate Posted October 8, 2017 Share Posted October 8, 2017 As many of you know, I'm in the ATM business. In the last few weeks, I've been asked over a dozen times about Bitcoin. Honestly, I just don't understand bitcoin or any cryptocurrency. My biggest hang up is where it comes from. The answer I always get is "it's computers that mine for it like gold, the computers solve complicated math problems." , the amount of stupid questions I have after that are too vast to even begin asking. Anyways, I did a little research and I'm far from an expert. The Bitcoin ATMs you can buy or sell bitcoin. If you are buying, you insert the cash the cash into the ATM, and the ATM provides a QR code that you scan with your cell phone and it adds the bitcoin to your "vault". If you are selling, you create a QR code with you vault, scan it at the ATM and the ATM dispenses cash. The ATM charges a fee to do these functions. You are able to buy and sell online, but the advantages of physical ATM are 1) If you are buying, you can use cash to buy and you stay anonymous, which for bitcoin geeks seem to be important. 2) If you are selling, you are pretty much just doing one transaction and able to immediately turn the Bitcoin into cash. If you sell online, you are selling the transaction and then withdrawing cash (pretty much 2 transactions). As far as an opportunity I can see it two ways..... 1. ) An early adopter - You will most likely be able to have a choice of locations. Locations will be easy to get. You will be in front of the curve. Unfortunately, the future of Bitcoin it very grey. Government regulation is almost certain. Risk seems very high, but if it hits bit and you are in early - the rewards could be huge. 2.) A wait an see approach - You could miss the best spots, the learning curve be greater if you wait. A Bitcoin ATM costs between $6000-$10,000. The return on investment on a traditional ATM, still seems better. I'm personally going to keep a very close eye on it, stick with traditional ATMs, continue to learn and understand. If I see this moving towards critical mass, I may try to jump in. A friend advised me to add "first right of bitcoin ATM refusal" to any new ATM contracts (although I'm not a big contract guy) Hope this helps and creates conversation....... Link to comment Share on other sites More sharing options...
VendingFanatic Posted October 8, 2017 Author Share Posted October 8, 2017 On 10/7/2017 at 12:19 PM, AZVendor said: That doesn't mean anyone is getting a return on their investment though so that would be a scam. How would a transaction even work? Do you withdraw virtual bitcoins to your phone? Where, then, could you spend them? If it's just a way to transfer fake money around you can do that online. Bitcoin is not 'fake money'. In fact, U.S. dollars is actually more 'fake' than bitcoin is, in that the federal reserve simply prints out paper, it's not backed by anything and they can print out an unlimited supply of paper money. Whereas, bitcoin has a limit on how much can be created (mined). Therefore, over time, bitcoin will not lose it's value as fast as u.s. dollars do because something that is of limited quantity will have more value. There are already certain foreign countries that do not accept the u.s. dollar. The U.S. dollar may lose it's value in the next decade. Anyway, that ^ is a topic of discussion for another day. I'm on the fence about buying a bitcoin ATM machine because I live in a state where people do not adopt fast to technology and people where I live are very traditional and old fashioned. So I do not think investing in a bitcoin ATM machine in my location would be in my best interest. I am going to keep an eye on the news. But, my news stream, shows that crypto currency is becoming more and more accepted each and every day. Link to comment Share on other sites More sharing options...
orsd Posted October 9, 2017 Share Posted October 9, 2017 1 hour ago, VendingFanatic said: I'm on the fence about buying a bitcoin ATM machine because I live in a state where people do not adopt fast to technology and people where I live are very traditional and old fashioned. So I do not think investing in a bitcoin ATM machine in my location would be in my best interest. I am going to keep an eye on the news. But, my news stream, shows that crypto currency is becoming more and more accepted each and every day. Your not going to have good success in such a place. Most people who are accepting and using Bitcoin are young tech people living in large cities. Most older folks and non tech people don't trust this kind of stuff, hell some still don't use credit cards. Link to comment Share on other sites More sharing options...
BluePlate Posted October 9, 2017 Share Posted October 9, 2017 3 hours ago, VendingFanatic said: Bitcoin is not 'fake money'. In fact, U.S. dollars is actually more 'fake' than bitcoin is, in that the federal reserve simply prints out paper, it's not backed by anything and they can print out an unlimited supply of paper money. Whereas, bitcoin has a limit on how much can be created (mined). Therefore, over time, bitcoin will not lose it's value as fast as u.s. dollars do because something that is of limited quantity will have more value. There are already certain foreign countries that do not accept the u.s. dollar. The U.S. dollar may lose it's value in the next decade. The next few year will be very interesting for Bitcoin. The fact that our Government can control it and pass laws regulating Bitcoin, makes it less of a currency than the US Dollar. Most lawmakers are over 40 and like me do not understand it (or the power it), so the laws that are passed will most likely not be right the first time around. Liken it to Marijuana in, not until the children of the 1960's became lawmakers, did it ever have a chance to become legal. Link to comment Share on other sites More sharing options...
Poplady1 Posted April 1, 2018 Share Posted April 1, 2018 Speaking as someone hired to locate 10 bitcoin ATM's in California, it was interesting. Found the best places to locate them was International airports or hotels or malls close by those locations. I ended up putting 3 in the areas around Disney properties and Universal and 1 at a large university. Also near Sea World. All in all the ATM guy was very happy with the spots. My fee was $500 a spot with on going 2% comm as long as the machine remained in those locations. As of today (almost 2 full years from placement), 7 spots are really doing well and the other 3 I let him out of the agreement so it would be more profitable for them. The problem today is bitcoin has really dropped in value. Link to comment Share on other sites More sharing options...
Poplady1 Posted April 9, 2018 Share Posted April 9, 2018 On 10/8/2017 at 12:51 AM, BluePlate said: As many of you know, I'm in the ATM business. In the last few weeks, I've been asked over a dozen times about Bitcoin. Honestly, I just don't understand bitcoin or any cryptocurrency. My biggest hang up is where it comes from. The answer I always get is "it's computers that mine for it like gold, the computers solve complicated math problems." , the amount of stupid questions I have after that are too vast to even begin asking. Anyways, I did a little research and I'm far from an expert. The Bitcoin ATMs you can buy or sell bitcoin. If you are buying, you insert the cash the cash into the ATM, and the ATM provides a QR code that you scan with your cell phone and it adds the bitcoin to your "vault". If you are selling, you create a QR code with you vault, scan it at the ATM and the ATM dispenses cash. The ATM charges a fee to do these functions. You are able to buy and sell online, but the advantages of physical ATM are 1) If you are buying, you can use cash to buy and you stay anonymous, which for bitcoin geeks seem to be important. 2) If you are selling, you are pretty much just doing one transaction and able to immediately turn the Bitcoin into cash. If you sell online, you are selling the transaction and then withdrawing cash (pretty much 2 transactions). As far as an opportunity I can see it two ways..... 1. ) An early adopter - You will most likely be able to have a choice of locations. Locations will be easy to get. You will be in front of the curve. Unfortunately, the future of Bitcoin it very grey. Government regulation is almost certain. Risk seems very high, but if it hits bit and you are in early - the rewards could be huge. 2.) A wait an see approach - You could miss the best spots, the learning curve be greater if you wait. A Bitcoin ATM costs between $6000-$10,000. The return on investment on a traditional ATM, still seems better. I'm personally going to keep a very close eye on it, stick with traditional ATMs, continue to learn and understand. If I see this moving towards critical mass, I may try to jump in. A friend advised me to add "first right of bitcoin ATM refusal" to any new ATM contracts (although I'm not a big contract guy) Hope this helps and creates conversation....... Excellent discription of a difficult subject. I agree, Bitcoin is probably not a good investment, yet. They do well at Universities, International airports, amusement parks, International Hotels. Those spots are going fast. Link to comment Share on other sites More sharing options...
MidStateVending Posted April 27, 2018 Share Posted April 27, 2018 I dabbled in Bitcoin and lost (only) hundreds of dollars via websites shutting down, garbage software, and transactions that won't confirm. Transactions take forever and more difficult than PayPal or a credit card. Bitcoin is crap... just by two bits. Link to comment Share on other sites More sharing options...
brendio Posted April 27, 2018 Share Posted April 27, 2018 I agree that bitcoin is a bit limited, but crypto is here to stay. If getting a bitcoin ATM, I would advise getting one that can also easily do altcoins, so you are not tied to the success of just bitcoin, if another coin takes dominance in the space. Link to comment Share on other sites More sharing options...
Anacapa Vending Posted November 3, 2018 Share Posted November 3, 2018 Bitcoin was a major component in the growth of my company in 2017. Got lucky. I'm intrigued by bitcoin ATMs but not willing to take that risk either. I would be very concerned if I was an ATM operator right now. IMO the days of 3rd party atm operator's are numbered. Look at how fast traditional credit and cashless transactions are gaining on fiat transactions. Fiat currency will not exist in the next 15-20 years. Link to comment Share on other sites More sharing options...
NYvending Posted November 8, 2018 Share Posted November 8, 2018 On 10/7/2017 at 12:11 AM, VendingFanatic said: Hi, I was wondering if anyone had any advice regarding bitcoin ATM machines? I operate ATM's in 4 states and will likely add Bitcoin service over the next few years now that traditional ATM's are getting software support for Bitcoin if the regulatory landscape improves I will integrate it but right now compliance costs don't make it practical. Regarding Bitcoin ATM's I would suggest waiting. The standard commissions run 10% of amount purchased though they can be as high as 20-25% in NYC. The biggest obstacle is the regulatory compliance. Bitcoin ATM's fall under KYC/AML laws so you will likely need a money transmitter license in any state you place them. NY requires a Bit-license as well which only a few have been issued and they are generally to deep pocketed companies with multimillion dollar bankrolls. When I looked into the required licensing last year outside of NY I stopped once the compliance costs exceeded six figures. I expect as the laws improve over the next 3-5 years it will become a fan more efficient business to operate. Though the commissions will drop as well, part of why they are so high is because of the outrageous compliance costs to sell Bitcoin. Honestly thought you will do far better in terms of ROI if you simply put the investment into Bitcoin itself and throw it on a hardware wallet for 5 years. Link to comment Share on other sites More sharing options...
brendio Posted November 8, 2018 Share Posted November 8, 2018 11 hours ago, NYvending said: I operate ATM's in 4 states and will likely add Bitcoin service over the next few years now that traditional ATM's are getting software support for Bitcoin if the regulatory landscape improves I will integrate it but right now compliance costs don't make it practical. Regarding Bitcoin ATM's I would suggest waiting. The standard commissions run 10% of amount purchased though they can be as high as 20-25% in NYC. The biggest obstacle is the regulatory compliance. Bitcoin ATM's fall under KYC/AML laws so you will likely need a money transmitter license in any state you place them. NY requires a Bit-license as well which only a few have been issued and they are generally to deep pocketed companies with multimillion dollar bankrolls. When I looked into the required licensing last year outside of NY I stopped once the compliance costs exceeded six figures. I expect as the laws improve over the next 3-5 years it will become a fan more efficient business to operate. Though the commissions will drop as well, part of why they are so high is because of the outrageous compliance costs to sell Bitcoin. Honestly thought you will do far better in terms of ROI if you simply put the investment into Bitcoin itself and throw it on a hardware wallet for 5 years. I think you are on the money regarding compliance costs making Bitcoin ATMs less (or not at all) viable. I live in a different country, so it's a different scenario, but I think there is enough in common. I bought a bitcoin ATM (with bitcoin) to have a play around with and potentially site. Three months after I got it (while I was still testing it to make sure I understood how it worked so as not to make a costly mistake), the laws here changed and operators are now required to register with the government anti-money laundering department. I emailed to enquire as to what is involved, but never heard back, and haven't had time since to pursue it further. I suspect as is your case that it will be an expensive exercise and not worth it for a sole operator. Also, the requirement for KYC rules destroys the main advantage these bitcoin ATMs had over exchanges -- the ability to stay anonymous. If you have to undergo KYC, you may as well just wire money to an exchange and get far lower commissions on your trades. Perhaps, in future years there will be service companies to outsource the compliance activities to, or provide off the shelf policies and procedures for operators to use, and that will make it easier, but I think that in time bitcoin ATMs will become less lucrative (as will cash ATMs). Here in Australia, you can now buy bitcoin at thousands of newsagents around the country. They presumably already have procedures in place, as they also act as agents for a lot of other money services (including online gambling). I can't remember the last time I used an ATM to get cash out. Just about everything is paid with card here now. I think only those operating illegally or under the radar stand any chance to make money, but then for how long...? A guy I sold some bitcoin to told me of a bitcoin ATM in the "weed capital" of Australia that he said did a roaring trade. I think it was one of the first bitcoin ATMs in Australia. I'm not sure whether it now requires KYC, but I'd bet its business would be well done now if it does. Link to comment Share on other sites More sharing options...
NYvending Posted November 8, 2018 Share Posted November 8, 2018 Agreed, in the States complying with KYC/AML requires you to have a full time compliance officer and physical copies of all customer data available to government on a moments notice or the fines will put you out of business. I agree that I do believe much of this will get outsourced and become simpler over time. As you mentioned as well the laws can change on a whim as the technological aspects of Bitcoin are really hard to grasp as you need both a background in economics and computer coding to really "get it." Most people who use Bitcoin let alone the government don't understand the technology which makes legal compliance almost impossible at the moment. Bitcoin can still and always will be able to be used anonymously if you know what you are doing. It's gotten far simplified now that you can use a coin join or lightning wallet on a smartphone but once the government realized you can KYC Bitcoin at the point of sale then transfer them to an app and they become untraceable back to you I expect they will continue to try and fit a square peg in a round hole on the legal front. Most the companies in the states going the Bitcoin ATM route have huge bankrolls for a reason. They can afford the fines and legal battles because up until 2017 you could do almost anything with Bitcoin and the government paid little attention to it. So the players in the space have been making money for years doing this as being first can reap huge rewards. I don't know about Australia but for someone in a major metro area here would probably do better just selling Bitcoins in person through localbitcoins as you don't need any startup besides a smartphone, bitcoins, and be willing to zip around the city for sales much like a weed dealer lol. Link to comment Share on other sites More sharing options...
brendio Posted November 9, 2018 Share Posted November 9, 2018 I have used localbitcoins a bit in the past, and had some good conversations with people new getting into bitcoin, but I am regional, so I haven't have a lot of clients. Our new laws now apply to localbitcoins the same as bitcoin ATMs, meaning you need to register your business. You are probably a smaller target than ATM operators, but I know a guy in the states who had an undercover agent transact with him on localbitcoins and then he had the FBI raid his house for not having the proper paperwork. Our government is not as brutal as yours, but it's still not a risk I really want to take. Link to comment Share on other sites More sharing options...
NYvending Posted November 10, 2018 Share Posted November 10, 2018 Oh I don't disagree I don't think it's worth the risks. The laws here are weird with localbitcoins because as long as it's not your business or primary means of income individuals are able to sell Bitcoin as property so if to private individuals meet a sale doesn't require KYC/AML much like if we met up and I sold you any other item I owned. However if you do it full time as a business you have to KYC/AML as you have to act within money transmitter laws when functioning as a business. If you move a significant amount of money the government will care about it sooner or later so it gets very gray and nothing I would mess with thought some people have made quite the haul doing it. Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.