basic ideas
Bitcoin ATMs (or BTMs) allow users to buy and sell Bitcoin (and sometimes other cryptocurrencies) using cash or debit cards.
If you are new to cryptocurrency, you will need to set up a cryptocurrency wallet before using a Bitcoin ATM.
Bitcoin ATMs are easy to use but charge high fees, usually much higher than online alternatives, sometimes as much as 20% per transaction.
What is a Bitcoin ATM?
Have you ever wondered how you can buy Bitcoin with old money? That’s where Bitcoin ATMs come in!
A Bitcoin ATM is exactly what it sounds like — a Bitcoin (BTC) ATM. It’s a physical machine, usually found in public places, that lets you buy or sell Bitcoin (and sometimes other cryptocurrencies) in exchange for cash or a debit card. It’s like a traditional bank ATM, but it connects you to the exciting world of cryptocurrencies instead of a regular bank.
How do Bitcoin ATMs work?
Bitcoin ATMs are simple and straightforward. To buy Bitcoin, you insert cash into the machine, then scan your wallet’s QR code, and the ATM will automatically convert your BTC to your wallet address. We’ll go over the steps in more detail below, but keep in mind that you’ll need to set up a cryptocurrency wallet if you haven’t already.
Bitcoin ATMs may offer both buying and selling services depending on the location. However, some Bitcoin ATMs will only allow you to buy while others will only allow you to sell.
If the ATM allows you to sell Bitcoin, you can do so by sending coins from your wallet to the address the machine provides you with. Once the transaction is confirmed on the blockchain (which can take some time), the ATM will issue the cash. Just make sure to check whether the ATM you’re using supports selling or not.
But what's the price? The fees!
While Bitcoin ATMs can be convenient to use, this convenience is not free. Most cryptocurrency ATMs come with very high fees. They can charge anywhere from 7% to 20% per transaction, which is much more than you would pay on an online trading platform.
In comparison, online cryptocurrency exchanges charge fees ranging from 1% to 4% for bank deposits or credit card purchases. On Binance, deposit fees can vary from 0% to 2% depending on the currency, location, and your payment method. If Binance P2P is available in your region, you can easily buy and sell cryptocurrencies online with very low fees.
So while using a Bitcoin ATM is quick and easy, it is much more expensive. Some machines also have minimum and maximum transaction limits. For example, you may need to buy at least $10 worth of Bitcoin or be limited to a purchase limit of a few thousand dollars per transaction. Always check these limits before you start!
You should also be careful to choose an ATM that has good recent reviews, which display the owner’s contact details, provide a summary of prices and a clear fee schedule. There are fake machines out there, so this information can help you assess their credibility.
Where can you find Bitcoin ATMs?
As Bitcoin has grown in popularity, so has the number of ATMs. There are now tens of thousands of cryptocurrency ATMs around the world, most of them in the United States, but they are also found in other countries.
You’ll often find them in places like gas stations, shopping malls, and airports. If you’re looking for a machine, you can use online services like Bitcoin ATM Radar to help you locate a Bitcoin ATM near you.
Advantages and disadvantages of Bitcoin ATMs
Advantages
Ease of Use: Great for beginners who want to navigate the world of cryptocurrencies without dealing with online trading platforms.
Cash Friendly: You can easily buy Bitcoin with cash without using a bank account.
Relatively fast: No need to wait days like some bank transfers.
Disadvantages
High fees: Convenience comes at a price, and is often much higher than online alternatives.
Limited availability: Although they are becoming more popular, you may still have trouble finding a device nearby, depending on where you live.
Security Risks: Be careful. As with any machine that handles money, Bitcoin ATMs can be targeted for theft or fraud. There are also counterfeit machines.
How to use a Bitcoin ATM?
Want to give it a try? Here’s a quick guide on how to use a Bitcoin ATM:
Get a cryptocurrency wallet: You will need a wallet address to receive your bitcoins. Make sure you have a wallet address that can generate a QR code (e.g. Binance App or Trust Wallet).
Find a Bitcoin ATM: Use an online locator like Currency ATM Radar to find the nearest one. But beware of fake ones. Choose an ATM with good recent reviews and clear information (owner contact details, rates and fees summary, etc.).
Verify your identity: Some devices may ask for your phone number or photo ID. In some cases, this depends on the amount of Bitcoin you are buying or selling.
Scan your wallet's QR code: When you're ready to buy, scan your wallet's QR code so the device knows where to send your bitcoins.
Make a payment: Follow the on-screen instructions to enter cash or swipe your debit card to see how much you want to spend.
Confirm the transaction: Once the blockchain confirms the transaction, the bitcoin will appear in your wallet. You may have to wait a while, depending on how busy the network is.
Should I use a Bitcoin ATM?
This depends on several reasons. Bitcoin ATMs may be a good option for those who want a simple way to buy Bitcoin with cash. But remember that there are security risks, and high fees can make the purchase expensive.
For most people, the convenience of Bitcoin ATMs is not worth the high costs and potential risks. The truth is, it’s cheaper and safer to buy your first cryptocurrencies through reputable exchanges like Binance, which offer multiple payment methods in different currencies.
Related Articles
Disclaimer: This content is provided to you “as is” for general informational and educational purposes only, without any representations or warranties of any kind. It should not be construed as financial, legal, or professional advice, nor is it intended as a recommendation for the purchase of any particular product or service. You should seek professional advice from professional advisors. If this article is provided by a third party, please note that the opinions expressed are those of the third party and do not necessarily reflect the views of Binance Academy. Please see the full disclaimer here for more details. Cryptocurrency prices are subject to price fluctuations, and the value of your investment may go up or down, and you may not get back the amount you invested. You are solely responsible for your investment decisions, and Binance Academy is not responsible for any losses you may incur. This article should not be construed as financial, legal, or professional advice. For more information, please see the Terms of Use and Risk Warning.
