You may have noticed that in many of the usual locations where you can find a bank ATM, like convenience stores and gas stations, there’s another kiosk right next to the bank’s kiosk that says it is a Bitcoin ATM.
Question: So how does that work? Bitcoin is a digital cryptocurrency, so what exactly can you do with it using one of these kiosks?
Answer: All Bitcoin ATMs allow you to use cash to buy Bitcoin. And many of these kiosks also allow you to sell Bitcoin and receive cash. You can also insert cash and have it sent to someone else’s Bitcoin wallet, or account. You just need a smartphone. Here’s how:
Buying Bitcoin with an ATM
The process is quite simple and most Bitcoin ATMs work in the same way.
- You create an account with the Bitcoin ATM operator, privately establishing your identity.
- You need a Bitcoin wallet that will securely store the records of all of your Bitcoin transactions, and this can be done easily with a downloadable app for your smartphone.
- Insert cash into the ATM, and indicate which Bitcoin wallet address you want to send it to. Let’s say you insert $100. The Bitcoin ATM operator then sells you $100 worth of Bitcoin at the market price at that moment, minus their own operating fee. Some operators also deduct the miner’s fee.
- You receive a confirmation that your Bitcoin wallet now holds the secure record of this transaction, proving that you own that $100 worth of Bitcoin, minus the fees.
NOTE: Not all Bitcoin ATM operators are the same! Some take longer to complete transactions than others, and the fees charged can be quite steep. And if you have problems, it can be really hard to get customer support.
Selling Bitcoin with an ATM
If you own Bitcoin, then you already have a Bitcoin wallet. Many people have more than one wallet, so you need to decide in advance which wallet and key you want to use to sell your Bitcoin.
- If you don’t already have an account with a Bitcoin ATM operator, you will need to create one.
- Then, using one of their Bitcoin ATM kiosks, you log in to your account, indicate how much Bitcoin you want to sell, and which wallet address you want to sell from.
- This transaction needs to be verified on the Bitcoin network, or blockchain, and you will receive notification when it has been verified and you can withdraw your cash. This takes longer than buying Bitcoin, and different operators require more time than others.
NOTE: Different operators also have different levels of customer service, if any, so it pays to do your research in advance and do business with a Bitcoin ATM operator who is reputable, and has fast, reliable customer service.
- As with buying Bitcoin, the ATM operator will charge a fee for the transaction, so the cash you collect will be minus the operator’s fee and possibly also the miner’s fee. Depending on the current market value of Bitcoin at the time of your sell transaction, it may be worth more or less than you paid for it originally.
Sending Cash to Someone Using a Bitcoin ATM
You can send Bitcoin to someone else by selling some of your Bitcoin and having it sent to their Bitcoin wallet.
But if you want to send cash to someone, and not sell your Bitcoin to do it, here’s how:
- You will need to have an account with the Bitcoin ATM operator.
- Log in to your account on their Bitcoin ATM kiosk and indicate the amount of cash you want to send, and the address of the Bitcoin wallet you are sending it to.
- Insert cash and it will be deposited in the recipient’s Bitcoin wallet in the form of Bitcoin that they can then cash in and withdraw.
Coinsource charges the lowest fees of any Bitcoin ATM operators, and they also provide 7-day-a-week live customer support. They never pass along miner’s fees to their users, and your transactions with Coinsource are quick and easy.
Download the Coinsource Bitcoin Wallet App: