As news that 400 Bitcoin ATMs may soon be gracing the byways and highways of Dubai, it’s interesting to note the rise in actual cryptoATM activity in recent months and what exactly is happening in this space.
First, let it be said that the market for bitcoin ATMs is a little frothy. Not only are people fascinated by the concept, manufacturers like Lamassu and Robocoin can barely keep product in stock. A pair of entrepreneurs I talked to in Warsaw have two ATMs on order and, as time passes, they feel they are running out of places to put them. They are stuck on a Lamassu waiting list while bitcoin ATMs pop up like autogenetic, highly armored electronics.
Sadly, these things aren’t quite ready for prime time. A Robocoin model launched in Austin over SXSW required you to submit your telephone number, a copy of your government ID, as well as a photo and a vein scan. Then, owners must pay $20,000 or more for the machine and have a “float” of $75,000 or so to stock the machine. Transactions are controlled by the vagaries of the blockchain so it could take anywhere from five to fifteen minutes – or more – to make a purchase.
Right now there is a great arms race. As ATM makers drop their wares on unsuspecting cities everyone is clamoring that they are the first in Scranton or the best Dogecoin source in Sausalito. Interestingly, these ATMs aren’t for the hardcore users. As evidenced by the effort to put so many in Dubai, the makers are targeting fairly wealthy environments where folks with disposable income might want to try their hand at bitcoin.
There are, obviously, local alternatives including regular Satoshi Squares where you can trade bitcoin for cash face-to-face. But this is a key moment for the bitcoin gold rush and we haven’t quite reached peak ATM. Once they’re on every corner I expect we’ll hear far less about them but until them except a litany of “I tried my first bitcoin ATM” posts to appear from here to Timbuktu (a wide-open market, incidentally).