Step-by-step: Buying Bitcoins from a machine.
When Bitcoin burst upon the financial scene as the world’s inaugural cryptocurrency, there were few points of consumer access outside of exchanges dedicated to trading in the virtual currency.
Then in 2013, Andrew Barnard and Douglas Carrillo saw a Bitcoin ATM machine in a Vancouver cafe. They went on to cofound the South Florida-based Bitcoin ATM operator Bitstop.
After two years of educating Florida regulators about Bitcoin and finding a bank that would do business with them, Bitstop started placing ATMs in retail locations around the state for consumers to acquire Bitcoin. Barnard estimates there are now 2,000 Bitcoin ATMs worldwide and just over 1,000 in the United States, all operated by a small core of companies.
Most charge transaction fees that range up to 20 percent. Barnard said Bitstop charges 13.5 percent.
“We’re on the lower end of the spectrum,” he said. “We hope to bring that down over time. Right now, it’s about access and getting more locations out there. Hopefully, we can get it down to below 10 percent.”
As with a traditional bank ATM, speed and ease of use are the keys to good customer service.
To buy Bitcoin from a Bitstop ATM, customers need valid identification such as a driver’s license, a mobile phone and a Bitcoin “wallet,” where users store their Bitcoins. (Before proceeding to a machine, users should check Bitstop.co for help in selecting a wallet from an app store and setting it up).