The United States Reigns Supreme in the Bitcoin ATM Industry
CoinATMRadar performs website mapping and tracks trends for Bitcoin ATMs or BTMs globally. It circulated 2016 data recently together with forecasted trends for this year. The website said the United States dominates the BTM market with a share of around 73%. It shows some 951 Bitcoin Automated Teller Machines (ATMs) in 55 countries and 192 operators. 555 of these are in the US. Canada has 136 and the United Kingdom maintains 47. The US has controlled the market since 2014. CoinATMRadar expects this trend to continue.
Statistics exclude retail establishments, booths and other machines all over the world that sell the digital currency. CoinATMRadar revealed more than 36, 000 non-BTM locations to purchase the crypto-currency like the FlexePin of Canada as well as railway machines in Switzerland. This is a prepaid voucher allowing users to replenish their accounts to ensure safe and easy web payments. Some 8, 497 vendors to include ATMs across the world are listed on CoinMap.
Why the United States?
Bitcoin.com was able to get the position of CoinATMRadar regarding the growing trend of the BTM sector. Majority of operators choose the US apparently with installations taking place in that country although there is no significant increase in the number of operators.
More people prefer the BTM instead of a Bitcoin exchange. Leading manufacturers of Bitcoin ATMs implement identification features that include Identification Scan and Phone Registration based on Short Message Service (SMS). Use depends primarily on geographic locations, existing regulations, and risk tolerance of ATM operators. Nearly all ATMs in regulated countries have strict limitations and conduct some form of verifications.
These are legal prerequisites enforced firmly by authorities. Those who fail to conform can end up paying hefty penalties and getting prison terms. Even then, a few machines sell coins without registration but stringent rules will force these out of the business.
Preference for the BTM
Privacy is the main reason of customers’ especially new users in using BTMs. There is no need to register and await approval. It is not necessary to open a bank account so cash is used in operations. Industry players believe that BTMs have a bright future just like the digital currency. The Blockchain technology is not only gaining ground in the US but other countries as well. Take the case of Switzerland where the UK multinational accounting firm, Ernst & Young installed a BTM in its Swiss branch.
The automated teller machine will service employees and people living in the vicinity. Within the month, EY’s Swiss clients will be paid for advisory and auditing bills with Bitcoin. Ernst & Young is determined to transform Switzerland as a leading digital center. It is acclaimed for its responsiveness to Blockchain protocols and virtual currency innovation. The accounting giant is founding member of a group (Digital Switzerland) supporting digital modernization in world markets. EY is co-sponsoring the World Web Forum this year in Zurich and presenting company-planned Blockchain solutions.
Meanwhile, the Canadian Virtual Exchange (CAVIRTEX) invested in 10 Bitcoin Automated Teller Machines two years ago. It is the biggest Bitcoin exchange service in Canada which will likely make Mississauga and Toronto the regions with the largest amount of BTMs worldwide. Business directions of (CAVIRTEX) emphasize its conviction that Bitcoin will become more popular regardless of some controversies. The Exchange’s thinking is to develop accessibility of crypto-currency and enable users to transfer money through the Internet with minimal or no fees at all. North America has more BTMs compared to other regions like South America.
Considerations for BTM
The cost is very manageable. Standard purchase-only machines cost only between $3, 000 and $7, 000. However, this is still expensive for developing economies unlike developed countries with enormous wealth levels. There have been many cases of machines damaged or stolen even in the United States. Statistics are higher in other developing nations which imply there are more risks in operating these machines. There are two situations right now. Demand is higher in some countries but lower in others like South America. Machines that were not economically viable in Mexico were shut down. As usual, regulatory measures concerning Bitcoin and other crypto-currencies remain stringent in many countries.
It is important to set up a complete and closed cycle before operating a machine. Customers provide BTC to Cash conversion. This is why operators must implement Cash to BTC exchange. It is difficult to get hold of banking partners willing to provide access to banking accounts even in countries like the United States. The Bitcoin (BTM) enterprise is associated with cash purchased on a regular basis and deposited to legitimate accounts. It remains a very risky profile for financial entities.
Incidentally, there is no BTM in the Russian Federation and India. There may be no prohibition but rules and requirements are very rigid. In Germany, it is imperative to obtain a bank license from the Federal Financial Supervisory Authority or BaFin before any business or exchange can operate BTMs. This is close to impossible since the Authority is very meticulous regarding regulation matters.
The BaFin already published inputs on how the Bitcoin is currently regulated in Germany. It ascertains legality of the crypto-currency. As explained by the Ministry of Finance, the Bitcoin is a unit of account. It is a financial instrument according to the definition of German Banking Act. Said units of account are classified as alternate currencies and used as form of payment in joint or multiparty clearing circles. The basis is an agreement under private legislation. BaFin does not use the term, “Private Money” since it is misleading.
At present, the United States leads the whole world in the BTM industry but other countries may catch up sooner or later.