Author: John Ma
Summary
Today, there are many ways to buy digital currencies online. What should you do if you hold a large amount of cash and want to immediately convert it into Bitcoin? You can choose the usual way: deposit cash into your local bank > register on the trading platform and complete identity verification > top up your account > wait for the amount to arrive and finally complete the transaction.
The whole process is quite tedious, right? Wouldn’t it be nice if there was a magical self-service vending machine that could directly convert fiat currencies that have easily changed hands into Bitcoin? Happily, such machines already exist. We'll call it a "Bitcoin ATM" and this tutorial will detail how to use it.
Introduction
Most methods of buying Bitcoin online will link the user’s personal information to the purchase – from the KYC/AML compliant exchange to the credit card/bank account information used for payment.
One of the easiest ways to buy Bitcoin (BTC) anonymously is to use a Bitcoin ATM. In this guide, we'll walk you through how to buy Bitcoin with cash at a physical ATM, detailing the steps before, after, and during the purchase.
What is a Bitcoin ATM?
Bitcoin ATMs (automated teller machines) are similar in function to ATMs typically used to deposit cash into bank accounts. A normal ATM will take your cash and update your bank balance through the IOU (financial claim) mechanism, which you can then use to pay others.
Through Bitcoin ATMs, your cash can be converted into Bitcoins and then deposited directly into your Bitcoin wallet. Bitcoin ATMs may also often support the purchase of selected altcoins, and some machines also have the option to convert the digital currency into cash!
Preparation
Start with the most important things first! We need to set up a wallet for receiving purchased Bitcoins. There are many wallets to choose from on Android and iOS devices. In this guide, we are using Trust Wallet, other wallets are used in much the same way.
In the wallet App we need to find the public address. Most apps will display this information when you click the "Receive" button. We’ve chosen to use QR codes in this guide. If you are using a wallet that supports multiple digital currencies, make sure you have the public address for the digital currency you purchased (Bitcoin in this guide).
Global Bitcoin ATM machine distribution map. Source: coinatmradar.com
Next, we need to find the target Bitcoin ATM because we need to actually go there. Fortunately, coinatmradar.com offers a handy interactive tool to help find nearby ATMs. Enter your preferred location in the search field to display local Bitcoin ATMs.
Information about specific Bitcoin ATMs. Source: coinatmradar.com
Click on any map marker to see the location of the ATM and the currencies it supports. Click "View Details" to learn about quotations, fee schedules, operator details and other information. The most important thing is to see the ratings of other users.
We want to choose an ATM with excellent recent ratings, which clearly displays the owner's contact details and provides a quote and fee schedule. This information is an important basis for us to identify the authenticity of the machine.
Buy tokens
The picture above is a Bitcoin ATM. Now, we have a mobile wallet in one hand and cash in the other. Before pressing the button, it is recommended to check the machine and understand how it works. All machines have slightly different layouts (and looks), but the basic functionality is generally the same. In this guide, we use the machine pictured above as an example.
On the right is a touchscreen that displays instructions on how to buy or sell Bitcoin. It will display the current trading prices offered by this machine: the selling price is around 9,100 euros; the buying price is around 9,900 euros. (Note: A quick check at coinmarketcap.com shows that the total market price of Bitcoin is approximately €9,600, and earning the difference is how ATM operators make money).
On the left are slots for depositing and receiving fiat currency, a receipt printer, and a QR code scanner for entering addresses.
Click on the right side of the touch screen (the buying side) and select the "Buy" option (note that we need to buy Bitcoin, not other altcoins). Different models of ATM machines may have different settings for this option, but the difference is usually only in appearance, with the "Buy Bitcoin" option placed in a prominent position.
Use the ATM's QR code scanner to read the wallet's Bitcoin receiving address, telling the machine where to send the purchased Bitcoins.
Check whether the digital address displayed by the machine is exactly the same as the address displayed by your wallet App.
Please put cash into the deposit slot.
Set the miner fee you are willing to pay for this transaction to be included in the block (note: some ATMs do not have this feature). The higher the fee, the faster the confirmation.
Confirm the purchase information in the wallet and finally complete the transaction.
Keep your receipts in a safe place so that you can have records in case any problems arise later.
The transaction will then be sent to the Bitcoin network and your wallet will eventually receive the purchased Bitcoins. Please note that Bitcoin needs to be added to a block first, so it will not be available immediately. It usually takes 6 confirmations before final transaction. The single confirmation time in the Bitcoin network is approximately 10 minutes.
after purchase
After the purchase is completed, you can use Bitcoin's block explorer (for example: Blockchain.com) to track the progress of the transaction by searching for the receiving address or transaction ID. You will see the funds arrive in your wallet balance after 5 to 15 confirmations, depending on which wallet app you use.
This will be confirmed at least once within the first hour. If your account has not arrived after several hours, you should contact the ATM owner immediately to find out whether the delay is due to normal technical issues.
Summarize
Bitcoin ATMs bring convenience and speed to consumers who purchase Bitcoin with cash. As an added bonus, the Bitcoin purchased is not attached to your identity via bank transfer or credit card.
Similar to foreign exchange service providers, the buy/sell prices set by ATM providers often differ from Bitcoin’s current market price. Online tools like coinatmradar.com can help you find trustworthy ATMs with reasonable fees.
