Using bitcoin cryptocurrency is gaining in popularity and adds a sense of security to the banking process; however, the use of bitcoin ATMs is not always clear or easy. So to help, I have done some research to answer questions about the use of bitcoin ATMs.
Can you withdraw money from bitcoin ATMs? Money can be withdrawn from a bitcoin ATM. Bitcoin ATMs are used to exchange money for bitcoin or to exchange bitcoin for money. It is easy to withdraw money from a bitcoin ATM once you find one that buys bitcoin.
Now that you know that you can withdraw money from a bitcoin ATM, you need to know how to find one. Withdrawing cash from a bitcoin ATM is not as straightforward as going to an ATM with your debit card. This is discussed later in the article. We covered buying bitcoin using an ATM is this previous article.
How to Find a Bitcoin ATM
There are a few ways to find a bitcoin ATM. With that being said, they are rare in some areas, which means there may not be one close to you. Don’t worry because there are services that keep track of the ATMs and help you find them.
- CoinATMRadar is a service that helps you locate the ATMs based on your location. This service is great because it has both an IOS and Android app. CoinATMRadar also has features that help if you will be traveling globally. It allows you to look up ATMs by country. You can also put in your exact address to find a local bitcoin ATM.
- FindBitcoinATM is a service that is handy if you live in or will be traveling to Australia. It is a very limited area and only useful to a small subset of people. But if you ever plan to travel down under make sure you remember this service.
Both of these services will also tell you if the ATM buys, sells, or buys/sells bitcoin. Not all bitcoin ATMs buy and sell bitcoin. Some ATMs only buy, and some only sell while some do both. If your goal is to exchange bitcoin for fiat currency, then you will be able to find an ATM that does that using one of these services. Keep in mind that bitcoin ATMs charge a fee for using the services. Most ATMs charge between 7 and 10 percent for use.
Some bitcoin companies have their own ATMs. CoinSource is one of them. In order to use a CoinSource ATM, you need to have an account. You will be required to log into your account to either withdraw money or bitcoin from their ATM. When finding an ATM, make sure you know if you need an account with that particular company.
How to Use a Bitcoin ATM to Withdraw Money
Now that we know how to find a bitcoin ATM, let’s talk about how to withdraw money. This does not work the way a traditional ATM works. You can’t go with your debit card and just take out the money that is there. This is more of a trade.
How do Bitcoin ATMs Work?
Bitcoin ATMs are set up as an exchange. Think about when you travel to another country, and you need to exchange currency. Exchanging bitcoin for money works in a very similar way.
Bitcoin kiosks look similar to traditional ATMs, but they are not linked to a bank account.
Do Bitcoin ATMs Dispense Cash?
The simple answer is, yes, they do. The more complicated answer is, not all of bitcoin ATMS dispense cash. Some kiosks only dispense bitcoin. In this case, you would use cash or a debit card and receive bitcoin in exchange. When you need to exchange bitcoin for cash, you will need to search for a kiosk that buys bitcoin for cash. You can use one of the services above for this.
Do Bitcoin ATMs charge fees?
Yes, bitcoin ATMs charge fees. They are steep and range anywhere from 8 percent to 11 percent. This is similar to using an ATM that is not within your bank’s network. The difference is that it is not a flat fee like your bank. Instead, this fee is dependent upon how much you are exchanging. For example:
- If you exchange 500 USD for bitcoin you will be charged 40 USD in fees on the low end. That is using the 8 percent fee.
- This fee is also charged if you exchange bitcoin for cash.
Do Bitcoin ATMs require an ID?
Trading bitcoin at an ATM is one of the best ways to buy bitcoin with no Identification. This affords you complete anonymity. Most kiosks will have you input your public address and will then transfer your bitcoin or money to that address.
If you don’t have a public address, then the kiosk can give you a paper wallet. Some ATMs don’t do this, so when you search for an ATM, make sure you find out if they will dispense a paper wallet.
For the ATMs that require ID, it is because they have to comply with “know your clients” and “anti-money laundering” practices. CoinAtmRadar, in most cases, will give identification information when you are searching for a kiosk.
Why Does Anonymity Matter?
Anonymity matters for a few reasons. Most people don’t want their financial matters, and spending habits broadcast to everyone that can see their bank account or has access to receipts. Cash has afforded anonymous purchases for the population since the beginning of paper and coin currency, but in a digital age, we leave a fingerprint everywhere we go.
Anonymity is also good for businesses. If there is a product launch happening and the company wants to keep it quiet, financial anonymity is very important. Most financial records, for publically traded companies, are a matter of public record. Any person, organization, or reporter would be able to get ahold of that information and ruin the product launch.
This anonymity in bitcoin trading is afforded by blurring the lines between the sender and receiver in any given transaction. Technology has given us the possibility of buying goods from all over the world from our couch but has not afforded us the ability to keep those purchases private.
Bitcoin has allowed us the best of both worlds. We can be a global purchaser and still keep our privacy.
Are Bitcoin ATMs Safe?
Bitcoin ATMs are very safe. The only caveat to this is that some kiosks are placed in slightly hidden places that would be considered shady. This is because bitcoin ATMs are growing in popularity by appealing to the population that doesn’t use a traditional bank or is not able to use a traditional bank. The location of the ATM would affect the safety of the user, if the ATM is in an unsafe location, but your identity and your bitcoin currency are both safe even in those shady locations.
There was a scam at the end of 2018 that claimed there was malware that could hack a bitcoin ATM. The creator was charging $25,000 for this malware. An investigation proved that this did not exist and still does not exist.
If there was ever a hacking attempt, it would only affect the owner of the ATM owner and not the users. The owner would lose money and not the user. Since bitcoin ATMs are an exchange and not a bank that stores the user’s personal money, it wouldn’t have the same implications as when your bank is hacked, or your debit card is skimmed.