Bitcoin Forum

Globally installed crypto ATMs are being impacted by the protracted bear market, geopolitical unrest, a lack of regulatory certainty, and other unanticipated market conditions. News reports state that 796 cryptocurrency ATMs were removed from the global network in September. However, every day, there are around 14 cryptocurrency ATM installations worldwide. Moreover, nations continue to express interest in establishing operational crypto ATMs within their national boundaries. For example, Japan (https://cointelegraph.com/news/after-four-years-japan-brings-back-its-first-crypto-atm) decided to reintroduce crypto ATMs after 2014. The goal is  to set up 50 BTMs across the country by August 2023. I have mixed feelings about this and can't wait for this cycle to end. Read the full story below (https://cointelegraph.com/news/net-bitcoin-atms-growth-drops-globally-for-the-first-time-ever).


What do you think? Will the nearly 14 crypto ATMs being installed globally per day be able to compensate for the 796 crypto ATMs that were pulled off from the global network in September?

They're likely costly to uninstall (including the costs of the machine as it goes from being active to not).

I wonder what's happening with those 800 atms once they get disconnected, they're probably only useful as bitcoin atms so they'll probably come back online elsewhere or maybe at a different time. There was news a large currency exchanger with 3000-4000 machines (from memory) started accepting bitcoin, what if they've taken a lot of the demand here too from other places as machines that might have cheaper rates if they serve other functions too.

Perhaps if the companies hosting them have worked out they make a lot more money out of bull markets or more money out of announcing they have crypto atms they'll probably be turned back on in a few years when the next halving is.

No surprise as even centralized exchange usage drops when in bear markets; that, and add the fact that using online exchanges are far more convenient and overall better(probably besides privacy in some cases) than ATMs.

First of all, I want to say that the news source is probably one of the worst sources you can find for news related to cryptocurrencies - I wonder why people still promote their links on the forum?

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The following data may show how insignificant and absurd the news is :

According to data from the coinatmradar website, there are currently 38 179 crypto ATMs in 79 countries around the world. Of these, 33 924 ATMs are located in the US&Canada, which means that there are only slightly more than 4000 such devices in the rest of the world, with a note that you cannot find them in 2/3 of the countries. The fact that 796 ATMs have allegedly disappeared means absolutely nothing, because perhaps it is only one operator who has decided to exit such a business, and this month a new one may appear to replace it.

As for Japan, they can install 5000 such devices if they want, but the fact is that Bitcoin has never been very interesting to the Japanese, and somehow I doubt that will change. In addition, anyone who wants to buy or sell Bitcoin will certainly not be satisfied when they pay a 10%+ ATM fee, because it was and still is the most expensive way to trade cryptocurrencies.

Could it be re -withdrawn because they decided to put new updates or for any technical reasons and not necessarily be political, financial or organizational?
I did not used any bitcoin ATM, but I do not see it as an indication of increasing the alert or increasing/decreasing the proportion of bitcoin acceptance and so on.

Why won't it !?
Let's talk about certain things:
1. Accessibility
2. Rates offered

Overall I have seen that the rates offered by thr ATM's were not that great thus, given that margin it's easier to actually exchange everything on a wallet that you can download, verify and then use it in seconds to get a better rate.

Going to a physical ATM is honestly overrated, it might be wonderful for the emergency or something but at the end of the day its better to do it online. Also they are placed weirdly around the globe they also need to target the areas that would be beneficial for the company as well.

Regulations seems the big problem for Bitcoin ATM, even in my country many startup companies tried to do business with the installation of Bitcoin ATM but every attempt ended as a failure because the government and central bank doesn't really draw a line in most countries about installing of currency machine for public should be issued by which authority.

I believe the growth of crypto debit card such as crypto.com that partners with payment solution company like mastercard and visa contributes on this drop too since crypto user can use a regular ATM machine to withdraw there crypto including Bitcoin in fiat without the need of specific Bitcoin ATM machine.

Investment on Bitcoin ATM is too risky because of the competition with the regular ATM that accepts crypto cards for withdrawal. So I believe Bitcoin ATM investors is starting to cutloss and didn't plan to expand more since regular ATM machine can do what they are doing while they are limited only to Bitcoin.

No worries … Spain has added 3000 ATMs (http://cryptocurrency.packagingnewsonline.com/3000-atms-in-spain-add-bitcoin-purchases/) this September where you can acquire bitcoin from, and they’re not even on CoinATMRadar yet … nor should they … they really allow you to purchase a coupon at Euronet ATMs, which you can then redeem through Bitnovo’s website. A two phase purchase as such should not count as bitcoin ATMs, so the said 3K ATMs won’t come to the rescue.

On a serious note, it’s essentially impossible to determine why the net amount of bitcoin ATMs dropped by 796 units during September, as the data on CoinATM Radar does not drill-down into the information. Likely it is essentially based in the US, where the net amount decreased by 835 (https://coinatmradar.com/charts/net-growth/united-states/) bitcoin ATMs.

The best one can do is try to compare the current operators (https://coinatmradar.com/charts/top-operators/) with those from a recent snapshot (https://web.archive.org/web/20220811010656/https://coinatmradar.com/charts/top-operators/) (11/08/2022). It gives some potential high-level insights, but nothing conclusive:

Currently:

On the 11/08/2022:
That means that the top 10 operators have lost 905 ATMs in just under 2 months. Comparing the numbers for the top 10 operators, it seems that Bitcoin Depot went from 6.898 ATMs to 6.420, Coincloud went from 5.520 to 5.162, bearing most of the luggage. There are no further details, so one cannot tell why this has happened, if some of those have been replace by other ATMs from another operator, or anything of the sort. In fact, being the figure that of an overall net amount, one could make wrong assumptions by looking at a small sample of the data as I have done above.

As a former operator of ATMs, I do not see a bright future for ATMs. (I live in Canada.)

They are expensive to buy and you have so many fees to cover that you have to charge an extremely high markup to customers.

Depending on the company, the markup ranges from 8 to 20%.

And who buys Bitcoin at 8-20% markup? People being scammed and people doing shady business. :(

But as per the book of laws the central banks are individual authority not really possessed by the government just like the court of the country so the banks can certainly crumble the start-up companies by taking legal actions against them since every company needs the help of banks so they don't go to extreme situation to fight for it.

I remember that the vast majority of Bitcoin ATMs are in North America, so their distribution and significance has been very unequal for a while. It's important to keep in mind because there are many countries outside North America where Bitcoin is quite highly adopted but ATMs have never been a big thing or a part of that adoption. If we look at it this way, it doesn't seem like it's a big deal that the number of ATMs is dropping. Moreover, ATMs often require high fees, not to mention that making a transaction somewhere in a shop or even on the road where the ATM is can be far less comfortable than calmly doing it at home from a PC.

Could the drastic drop also as a result of the bear period? Between, in a normal circumstance how many people are actually using these ATMs to buy or withdraw on a daily basis? If the % is as high as what I read above, I don't think anyone will be eager to make use of btc atm to buy. That's a complete ripoff.

There are probably a bunch that were taken down because of this: https://bitcointalk.org/index.php?topic=5410704 and although a patch / fix has been out for weeks are still offline due to the attitude of 'I'll let someone else risk it for a bit' If you were not making a lot of money with your ATMs at the moment due to market conditions due to the possibility of loosing a bunch of funds you may be more wary of turning it back on.

I would also think a drop in ATMs is also due to increased competition. I have seen rates drop locally a lot. If you were charging 10% and now your competition is charging 7% you have to drop below that. But, if you are sitting on expensive leases and so on can you make money at 6.5% when BTC is below $20k? Or do you just shut down and walk away.

-Dave

Normal behavior as demand is low. In short, it's just the law of supply and demand at work. The market is down, with a great tendency to return to the levels of years ago.

Usually, bear market is a time to buy more and hodl. According to the graph of 'coin ATM Radar data' below, since 2014 there was less crypto ATMs. The bull cycle of 2017/2018 was around 250 net growth per month, so even in this bear cycle, it is X2 better than the previous bull cycle.
https://iili.io/LOQpOG.th.png (https://freeimage.host/i/LOQpOG)
 according to the above data, crypto ATM installations accelerated in 2021 which I think was partly driven by the rising value of the market, which has since plunged in 2022. For instance, Bitcoin dropped from it’s all-time high price of almost $68,000 in November last year by 70%. The asset is struggling to sustain its price above $20,000.
I see that Remitano.com also reported about it here (https://remitano.com/forum/nz/post/110297-net-bitcoin-atms-growth-drops-globally-for-the-first-time-ever) on  01/10/2022 same as OP's source.

In July, the net growth of ATMs was 572, low when compared to the peak 2,000 in 2021. “However if you compare to the last bull cycle in 2017-2018, there was only around 250 net growth per month. So in the current bear cycle, we are still 2x higher than the previous bull cycle,"  Forbes.com reports (https://www.forbes.com/sites/mariagraciasantillanalinares/2022/08/08/crypto-atms-lose-traction-in-tarnished-market/amp/)

In my opinion, I think It will.

Not an unexpected situation if you ask me. Bear markets are a time of much lower trading activity with smart investors buying (but not through ATMs), those who feel like they're at a loss crawling into their shells for winter because they feel like they got cheated by the market and holders keep holding.

ATMs are what becomes popular in bull markets when holders take some profit and newbie investors are so hyped up that they don't care about ATM fees, they just want to get some coins ASAP.

No worries though, a halving is just a little over year before us. We've been a year into the bear market and there's probably a few months of accumulation before us.

I think bitcoin atms have many headwinds. As already mentioned, they must charge a large markup, so will not be competitive on price. But also I am seeing more and more wallets that incorporate some sort of marketplace. Why would someone drive to an atm when they can buy right from their wallet on their phone? Maybe there are some reasons, but in general I see exchanges more used by traders and institutions, and wallets more for small time retail. This is maybe a simple way of looking at it, but I'm a simpleton anyways.

I would say that mainly those who try to avoid KYC buy in this way, but also those who have not yet found out that there is a much cheaper alternative, whether it is CEX or DEX.  As you yourself say, the price of such a device, along with all the costs arising from maintenance, insurance, and paying taxes, does not give the owners too much room to lower fees and be competitive with other players on the cryptocurrency market.

However, the number of such devices is constantly increasing, and regardless of the current situation, I think that it will continue, perhaps even at an accelerated pace, considering that more and more people are learning about Bitcoin and want to buy it in one way or another.

It was also interesting to me if Bitcoin ATMs have limits for deposit. With regular ATM, in some countries there are monthly limits of 5k for cash deposit, and it is physically impossible to insert a pile of banknotes in ATM whole. 1 Bitcoin, that is $19k or a solid pack of cash. It will take time before you feed all the banknotes to ATM. I am sure that will gonna cause people's interest, when they observe a person inserting banknotes for 10-30minutes without stopping. To that will be first signs of loosing anonymity. Imagine a persons wants to turn shady cash into 5 or 10 BTC...

P.S. I just cant imagine a person that wants to turn $10 into BTC will care much about KYC and will go to ATM to lose 8-20%.

I totally agree with you here. I have never also used a Bitcoin ATM and have never seen one in person and I also believe this situation is the same for 100% of the crypto people I know however, it does not affect our adoption of Bitcoin. As some have mentioned, there are downsides to the operation of these ATMS like here:
Either way, I don't see this affecting the general Bitcoin global trajectory in the future. 

People who are doing shady business definitely avoid KYC. People who are being scammed, not so much. As a result, large transactions are often made by people who are being scammed, not people who are doing shady business.

We've had customers who didn't care so much about the fees as they were caught in the hype or they were only buying a small amount of BTC. We've also had customers who didn't know about cheaper alternatives, or who couldn't use them because they were being blocked by their banks. Unfortunately, these types of customers are not as common as one would think.


The limits depend on the company and the law in the country. In Canada, if you want to buy or sell more than $1,000 at an ATM, you have to give out some of your personal information. If you want to buy or sell more than $10,000 per 24 hours at an ATM, you have to give even more information.

And yes, most ATMs will only accept one bill at a time, so it takes forever if you want to make a big transaction. ;D

I avoid KYC not because I'm doing something suspicious, but because I have the option to trade completely legally without it, but also because I don't want to pay taxes in a country where almost every day a politician ends up in prison, or where the prime minister laughs because someone stole $100+ million from a state-owned company as if it were some minor thing that should not be paid attention to.

In addition, I think that crypto ATMs are a very bad way to conduct any suspicious business because they are located in public places that are usually under video surveillance - real criminals use fake documents and launder money in much more sophisticated ways.

The usage and installation of cryptocurrencies saw a major rise from the year 2020. Whenever there is bearish movement in the market the usage and the installation gets affected. This is all about the impact of the market. In some countries amidst the prevailing market situation there is rise in the installation of cryptocurrency ATM. As mentioned Japan is a hub which helped in real-time usage of bitcoin through pos and ATMs.

Everything boils down to one thing - business profit! Installation of an ATM machine along with the rent of the space is a costly affair. So if those ATM machines are not bringing business profitability to the installer, why would any business entity bear the cost for an unforeseen time? No business would do that because it's a stupidity.

Crypto adoption is at a very nascent stage at this moment. So some locations may provide income, but as a business, installer needs to a cost benefit analysis and optimize their revenue stream. Probably that's what is happening!

Was talking to someone removing a BATM at a local place that had been there for years near JFK. Although he did not give a number, he more or less said that the owner of the shop wanted close to 3x what they had been paying for floor space so he is pulling it. Apparently the other people renting space there including a regular ATM and a bill pay kiosk either have not had the increase hit yet or the profit margins are so large on their businesses it's not a big deal.

-Dave

I'd say this is highly expected, as we can see that these are really the first set of wide scale challenges that the progress of bitcoin ATMs will be facing. A reduction in the number of bitcoin ATMs does not indicate a reduction in the number of bitcoin users. In the traditional banking system we see how many times ATMs are installed and then later removed from that locations either to be put elsewhere or to be sent back into storage, it hasn't affected or stopped people from getting to the new locations to still use these ATMs. Bitcoins will still do fine even without the BATM's.

^ I probably updated in a thread here and there around Covid onset, when machines were being removed, supposedly, as shop owners suggested, to install KYC limits and other requirements complying with AMLD5 (previous to 2020, I personally remember seeing 10,000k daily limit).

Well it's 2.5 years now and the several machines I remember in my area? Not a single one's been restored.

Airport one (Schiphol) didn't even last a year and no sign of it returning either.

@buwaytress, crypto ATMs are for some reason very popular in the US&Canada, and the rest of the world has always been quite uninterested in such devices, whether it's because people are simply not interested in starting such a business, or when they do, they quickly realize that they can't make a profit.

It's probably also a matter of the right timing, because during the bull run, the FOMO that starts really pulls everyone into the Bitcoin game, and during the bear market, Bitcoin is almost completely meaningless to most ordinary people. Therefore, for everyone who starts such a business, apart from the location and advertising, I think that the right timing is also a possible key to the profitability of the business.

Yeah, I think in US, working with US people before, it's actually quite hard for many apparently to get their hands on Bitcoin. Localbitcoin, which is the easiest p2p, doesn't work for you unless you want to go to jail. And not everyone can get on a Coinbase or Gemini account, apparently. So the easiest is ATMs, also to cash out BTC.

Where I'm from that's definitely the case (business not making profit) but here where I live now I got the impression they are actually quite popular, just around pre Covid was a bad time to dismantle running up to the bull and ATH. The Schiphol one also launched in the last "winter" so perhaps people just weren't interested then. Hard to run an ATM business when you've got to rely on interest though. I thought that airport one was the best: location, highest traffic, etc.

I didn't think that way, but the truth is that some US federal states have strange laws that make it impossible for some large CEXs to operate in them, but it is still a small number of federal states that should not affect such a large number of crypto ATMs in the US. It would be interesting to see the ratio of bought/sold at all those ATMs.


It makes sense because a lot of people pass there, but with the fact that many do not know what Bitcoin is, the question is how many people are psychologically ready to use such devices in airports? If you go on vacation or return home after a long time, you are more focused on other things than Bitcoin, at least it makes sense to me.