American citizens can now buy or sell digital currency from various locations, be it a gas station or a deli, all thanks to the presence of special bitcoin ATMs.
The machines have multiplied quickly through the United States over the past year, fueled by a frenzy in crypto trading that sent bitcoin prices over $58,000.
According to Reuters, kiosk operators such as CoinFlip and Coin Cloud have installed thousands of ATMs, scouring areas competitors have not yet reached.
“I just assumed there was demand and people wanted bitcoin everywhere,” said Quad Coin founder Mark Shoiket, who flew to Montana after scanning a US map for bitcoin ATM deserts.
During a week-long road trip, he found seven places to install machines, including 406 Glass, a store in Billings, Montana, that sells tobacco, vape juice, and colorful glass pipes.
As of January, there were 28,185 bitcoin ATMs in the United States, according to howmanybitcoinatms.com, an independent research site. Roughly 10,000 came within the prior five months.
Bitcoin’s growing popularity has been the primary driver for new installations.
There are various reasons for why people use ATMs rather than transacting online. Some get paid in cash, some lack bank accounts, some want to send remittances abroad or want anonymity, while others feel more comfortable interacting with a physical machine.
Rebecca White, a 51-year-old bitcoin investor who lives in the Pittsburgh area, makes larger investments online and uses bitcoin ATMs when her family has extra money.
“When we do our grocery shopping and we have $60 left, I will stop at the bitcoin ATM,” said White, who works in the nuclear power industry.
Some machines only offer bitcoin, while others let customers invest in various digital currencies. Few bitcoin ATMs can actually spit out cash, and they cost more than regular ATMs or transacting online.
Fees range from 6% to 20% of a total transaction, said Pamela Clegg, director of financial investigations and education at cryptocurrency compliance firm CipherTrace. Fees vary depending on the location and Bitcoin ATM operator.
“The growth of the ATM market – it is not even a gentle increase, it is almost a 45% increase,” said Clegg. “The growth is quite astonishing.”
Government agencies have raised red flags about some machines because of their cost and the potential for illicit activity. The New Jersey State Commission of Investigation detailed some of those concerns in a February report entitled “Scams, Suspicious Transactions and Questionable Practices at Cryptocurrency Kiosks”.
None of those concerns have stopped the industry’s growth.