What Is a Crypto ATM?
Crypto automated teller machines (ATMs) are stand-alone electronic kiosks that allow users to buy and sell cryptocurrency in exchange for cash or with a debit card. All crypto ATMs sell Bitcoin, while some also offer other cryptocurrencies.However, not all ATMs allow the sale of crypto, as some are limited to purchases only.
Crypto ATMs do not connect to your bank account like a traditional ATM; instead, they connect with a user’s digital wallet to process the transaction and send crypto to the customer. There are tens of thousands of crypto ATMs worldwide, with a large portion of them located in the United States.
Key Takeaways
- Crypto automated teller machines (ATMs) allow users to buy and sell cryptocurrency for cash.
- Bitcoin and other cryptocurrencies are offered by crypto ATMs.
- Crypto ATMs may not require identity verification to purchase.
How Do Crypto ATMs Work?
Crypto ATMs connect to a cryptocurrency exchange and convert deposited cash into crypto. Transactions are processed on the blockchain, which is a digital ledger of financial transactions for cryptocurrency. Using a crypto ATM involves connecting a user’s digital wallet (typically via a quick response [QR] code), depositing cash, and transferring the purchased cryptocurrency directly to the digital wallet.
Some crypto ATMs use a crypto exchange app that allows the redemption of a voucher purchased for cash. This allows users to deposit funds, select which crypto to purchase, and then print a voucher that can be scanned with a mobile app to redeem the voucher and deposit funds directly into a user wallet.
Most crypto ATMs only offer one-way transactions, meaning that crypto can be purchased but not sold. Some crypto ATMs offer two-way transactions, allowing users to buy and sell crypto in exchange for cash. Selling crypto is a similar process to buying: A user will scan their digital wallet QR code, choose how much crypto to sell, and receive cash from the ATM after the transaction is processed. ATMs that allow this will generally require a photo ID verification.
Where to Find a Crypto ATM
Crypto ATMs are distributed throughout the world, but the majority of them are found in the U.S. There are several apps that track the location of crypto ATMs, with Coin ATM Radar being the most thorough.
There are more than 36,000 crypto ATMs in the U.S. alone, with thousands also available in Canada. There are dozens of crypto ATM providers, with different services and features available on each.
Crypto ATMs are typically located in public shopping centers, gas stations, and airports, similar to traditional banking ATMs.
Risks of Crypto ATMs
Crypto ATMs are a great way to quickly exchange cash for crypto, but there are a few risks involved:
High Fees
Crypto ATMs charge high fees, with some charging more than 10% per transaction. Compare this with the fees of a traditional cryptocurrency exchange (1% to 4%), and users will pay more to use a crypto ATM.
Funds Not Insured
While some crypto exchanges offer custody services for crypto funds that come with anti-theft insurance, crypto ATMs require you to deposit funds into your own digital wallet. Self-custody can be a secure way to protect your crypto holdings, but there is no insurance against theft or loss.
Transaction Limits
As with most crypto exchanges, there usually will be minimum and maximum transaction limits set by the ATM company. Transaction minimums and maximums are generally in the range of $10 to $10,000.
Availability
Crypto ATMs are limited in their number and locations, and they may require traveling a long distance to access.
Security
Like traditional ATMs, crypto ATMs are machines made of hardware that run software. This means there is a chance of ATM-related theft, such as skimming devices or other tampering methods. Be aware of your surroundings when using these kiosks also, as cryptocurrency is valuable and an attractive target for thieves.
How to Use a Crypto ATM
Using a crypto ATM requires a mobile phone, a phone number, a picture ID (sometimes), and access to a digital wallet. While each crypto ATM provider has its own process, here are the common steps required to use a crypto ATM:
- Sign up for a digital wallet. Crypto ATMs connect to your digital wallet to facilitate the transaction, so you will need to create one to purchase crypto. There are many popular online wallets, and some crypto ATMs even offer their own wallet software.
- Find a crypto ATM. Using a service like Coin ATM Radar or a simple Google search can help you locate a crypto ATM near you.
- Verify your identity. Most crypto ATMs will need a phone number (at a minimum) to verify your identity, but some may require further verification, such as scanning a photo ID or entering your Social Security number.
- Scan your wallet. To buy Bitcoin or another cryptocurrency, you will need to scan your wallet address. Most digital wallets can display a QR code, which can be scanned into the crypto ATM.
- Make a purchase. Select the crypto you wish to purchase, choose how much to pay, and complete the transaction. You will need to deposit cash or pay using another accepted payment method.
- Wait for the transaction to complete. Transactions take place on the blockchain and can take a while to process. Once the funds have been deposited into your wallet and confirmed, the transaction is complete. You may get a receipt from the crypto ATM for the transaction as well.
Some crypto ATMs offer a printed voucher to redeem later, while others simply deposit funds into your wallet. Others may require downloading a specific application to use the ATM. Always read the on-screen instructions carefully before making any purchases at a crypto ATM.
Is There an ATM for Crypto?
Yes. There are several crypto ATM companies and thousands of ATMS throughout the U.S. and the rest of the world.
How Much Does Bitcoin ATM Cost?
Crypto ATMs are notorious for charging high fees for transactions. These fees may include a crypto exchange fee, cash exchange fee, or card processing fee (if using a debit card). Transaction fees can be as high as 20% (or more), depending on the ATM and the transaction being processed. According to research by Coin ATM Radar, crypto ATM fees average around 15% per transaction, which is very high. Fees vary by ATM and can be as low as 2% to 4%, but most are much higher.
How Much Does a Bitcoin ATM Charge for $500?
The fees for a $500 transaction on a cryptocurrency ATM depend on the service provider, blockchain fees at the time, how much you decide to pay to have your transaction prioritized, and other circ*mstances. It's best to find out how much you'll pay from the service provider before using an ATM to avoid surprises.
The Bottom Line
Crypto ATMs are kiosks that connect to a user's digital wallet and process transactions. Some crypto ATMs will let you withdraw cash at a cryptocurrency's current market price, but it generally requires a Know Your Customer (KYC) photo ID verification.
