Crypto ATM in India. Would it be worth it ?

[pawanjain]

It's been about 1.5 years since the first ever crypto ATM was launched in India. The first Crypto ATM was launched by Unocoin and was placed in some mall in Bengaluru. Unfortunately, Crypto was not legal in India at that time and hence the police seized the ATM and arrested it's owners.


Source: https://www.thenewsminute.com/article/india-s-first-cryptocurrency-atm-launched-bengaluru-90117

Things are changing now since India has uplifted the ban on cryptocurrencies. But the questions are

1. Does uplifting the ban gives the right to people to launch a crypto ATM ?
2. If a crypto ATM is successfully launched without any restrictions from any authorities how good would it be for us?
    Would it be worth it ? How do you think it will bring a change in India ?

Drop your comments below.

[webtricks]

This isn't the complete truth. ATM seize and owners' arrest weren't due to illegality of Bitcoin but due to the wrongful usage of term 'ATM'. In India, only banking sector can establish ATM machine. Other NBFCs can establish ATMs but setting up such ATMs require prior RBI approval and certain other requirements. But Unocoin arbitrarily set up machine and named it ATM. However, Unocoin could have avoided the aftermaths if the company used the term 'kiosk' instead of 'ATM'. The machine wasn't ATM in real essence. It was rather operating through Unocoin online account which puts the machine into mere definition of Kiosk.

Machine and the mechanism itself wasn't violating the RBI direction and was completely legit even before Supreme Court decision. However, it was the use of term 'ATM' which provoked State Police to take action against the owners. Even now when ban is lifted, setting up such machine and using the term 'ATM' would lead to retaliation from authorities.

I found a relevant video online from Crypto Kanoon youtube channel, he explained the situation beautifully in Hindi: https://www.youtube.com/watch?v=HwGODpXGlv8&feature=emb_logo

[akram143]

Never had an opportunity to use bitcoin ATM yet in my life but I will be looking some ATM in near future at least in my state.But tfor the question, is it really worth it for the owners? I don't think so because people choose online platforms to buy and sell their bitcoin then reaching a place called ATM.

[pawanjain]

This isn't the complete truth. ATM seize and owners' arrest weren't due to illegality of Bitcoin but due to the wrongful usage of term 'ATM'. In India, only banking sector can establish ATM machine. Other NBFCs can establish ATMs but setting up such ATMs require prior RBI approval and certain other requirements. But Unocoin arbitrarily set up machine and named it ATM. However, Unocoin could have avoided the aftermaths if the company used the term 'kiosk' instead of 'ATM'. The machine wasn't ATM in real essence. It was rather operating through Unocoin online account which puts the machine into mere definition of Kiosk.

Machine and the mechanism itself wasn't violating the RBI direction and was completely legit even before Supreme Court decision. However, it was the use of term 'ATM' which provoked State Police to take action against the owners. Even now when ban is lifted, setting up such machine and using the term 'ATM' would lead to retaliation from authorities.

I found a relevant video online from Crypto Kanoon youtube channel, he explained the situation beautifully in Hindi: https://www.youtube.com/watch?v=HwGODpXGlv8&feature=emb_logo

Yes you are right. I remember reading an article at that time which mentioned that the issue was due to it being called an ATM.
They did mention that it was merely a Kiosk. But then I wonder why did they not rename it and launched it again.
Also, why did they not launch the kiosk again after the ban was uplifted in India since they launched their exchange again.

[avikz]

This isn't the complete truth. ATM seize and owners' arrest weren't due to illegality of Bitcoin but due to the wrongful usage of term 'ATM'. In India, only banking sector can establish ATM machine. Other NBFCs can establish ATMs but setting up such ATMs require prior RBI approval and certain other requirements. But Unocoin arbitrarily set up machine and named it ATM. However, Unocoin could have avoided the aftermaths if the company used the term 'kiosk' instead of 'ATM'. The machine wasn't ATM in real essence. It was rather operating through Unocoin online account which puts the machine into mere definition of Kiosk.

Machine and the mechanism itself wasn't violating the RBI direction and was completely legit even before Supreme Court decision. However, it was the use of term 'ATM' which provoked State Police to take action against the owners. Even now when ban is lifted, setting up such machine and using the term 'ATM' would lead to retaliation from authorities.

I found a relevant video online from Crypto Kanoon youtube channel, he explained the situation beautifully in Hindi: https://www.youtube.com/watch?v=HwGODpXGlv8&feature=emb_logo

Yes you are right. I remember reading an article at that time which mentioned that the issue was due to it being called an ATM.
They did mention that it was merely a Kiosk. But then I wonder why did they not rename it and launched it again.
Also, why did they not launch the kiosk again after the ban was uplifted in India since they launched their exchange again.

Moreover, the Unocoin owner didn't have the permission to run such business. However, I don't think Unocoin would pursue this matter anymore because it is much cheaper to buy and sell bitcoin and other cryptos from any website like localbitcoins or zebpay or WazirX. Installing an ATM is a huge overhead cost for Unocoin.

But yes, only positive side of such ATM is that, it would have made a lot of people intrigued about cryptos. When people will see such ATMs at a public place, that would clear their mind about the legality of cryptocurrency in India. Some of them may actually try to gather some knowledge about it. It would have worked as an advertisement.

[webtricks]

~~

Yes you are right. I remember reading an article at that time which mentioned that the issue was due to it being called an ATM.
They did mention that it was merely a Kiosk. But then I wonder why did they not rename it and launched it again.
Also, why did they not launch the kiosk again after the ban was uplifted in India since they launched their exchange again.

Simple answer is negativity.

When they installed machine, initially it got good response but soon media start questioning their authority to set up ATM. Although it wasn't ATM but layman can't differentiate between the two.  Later, the co-owners who are very sought-after and respected personalities in Indian Crypto Domain have to go to jail for the same. For an average person, no matter whether he's right or wrong, going to jail isn't considered normal. People would simply assume they are running scam business especially when their business is related to something as delicate as cryptocurrencies (still many Indians consider cryptocurrencies as some kind of ponzi scheme).

I don't think under such circumstances, Unocoin should/would re-consider setting that kiosk again. It will cover very less customer base when compared to online dealing and is costly too.

[madhavsinghrajput]

This isn't the complete truth. ATM seize and owners' arrest weren't due to illegality of Bitcoin but due to the wrongful usage of term 'ATM'. In India, only banking sector can establish ATM machine. Other NBFCs can establish ATMs but setting up such ATMs require prior RBI approval and certain other requirements. But Unocoin arbitrarily set up machine and named it ATM. However, Unocoin could have avoided the aftermaths if the company used the term 'kiosk' instead of 'ATM'. The machine wasn't ATM in real essence. It was rather operating through Unocoin online account which puts the machine into mere definition of Kiosk.

Machine and the mechanism itself wasn't violating the RBI direction and was completely legit even before Supreme Court decision. However, it was the use of term 'ATM' which provoked State Police to take action against the owners. Even now when ban is lifted, setting up such machine and using the term 'ATM' would lead to retaliation from authorities.

I found a relevant video online from Crypto Kanoon youtube channel, he explained the situation beautifully in Hindi: https://www.youtube.com/watch?v=HwGODpXGlv8&feature=emb_logo

Exactly the term 'ATM' was the issue not the illegality.The unocoin had installed the kiosk inside the mall and mall already had trade permission so kiosk doesn't require any special permission.It was the branding blunder that created the confusion.To install an ATM in any premises you need to take approval of banking regulators and that they didn't had other than that it was also police negative attitude that got them arrested.The statement from one of the co-founder sathvik vishwanath says and i quote ”I have no idea where they (the police) are getting this false information from. For instance, they also told me we promised 2x returns and are trying to cheat customers. We have never made such claims nor have there been any complaints against us for swindling customers,”These sorts of negative publicity was done by police.
One should read this article below in order to have detailed information regarding that incident.
https://qz.com/india/1441787/how-unocoin-founders-were-arrested-for-their-cryptocurrency-atm/ 
And I think with uplift of ban all the possibilities to update crypto market is open.We might see this kiosk machines in every part india and it will be a benefit in both marketing as well as transaction.

[kabit9]

Exactly the term 'ATM' was the issue not the illegality. .....

https://qz.com/india/1441787/how-unocoin-founders-were-arrested-for-their-cryptocurrency-atm/ 
And I think with uplift of ban all the possibilities to update crypto market is open.We might see this kiosk machines in every part india and it will be a benefit in both marketing as well as transaction.

Actually the term ATM had alot to do with the 'raid'. The police are quick to act when they see a clear breach of laws - ATM laws governed by the RBI. They are not so quick to act when it is a grey area.



I believe this could be done again successfully with smart branding and PR (no use of word ATM, and news articles clearly explaining why the word ATM is not used).

[libert19]

But tfor the question, is it really worth it for the owners? I don't think so because people choose online platforms to buy and sell their bitcoin then reaching a place called ATM.

If you can directly convert crypto to cash then I would chose that over selling crypto for INR then going to ATM to withdraw the same.

[teosanru]

It's been about 1.5 years since the first ever crypto ATM was launched in India. The first Crypto ATM was launched by Unocoin and was placed in some mall in Bengaluru. Unfortunately, Crypto was not legal in India at that time and hence the police seized the ATM and arrested it's owners.


Source: https://www.thenewsminute.com/article/india-s-first-cryptocurrency-atm-launched-bengaluru-90117

Things are changing now since India has uplifted the ban on cryptocurrencies. But the questions are

1. Does uplifting the ban gives the right to people to launch a crypto ATM ?
2. If a crypto ATM is successfully launched without any restrictions from any authorities how good would it be for us?
    Would it be worth it ? How do you think it will bring a change in India ?

Drop your comments below.

A very interesting thought. I was addressing the same issue a few days before. So let's dig into the answers one by one:

1. Does uplifting the ban gives the right to people to launch a crypto ATM ?

Simple Answer is NO! As many users already told the word ATM was the problem right from the beginning and it would be the problem whenever they decide to open it again. If you would keep the name as ATM or Bank Kiosk or WLAs (which are White Label ATMs operated by Non-Banks). You will be under direct target from RBI. No one is allowed to operate an ATM without prior approval from RBI and this shit is absolutely illegal no matter who you are. So, you need to dig in with your legal expert to find out what name you would be giving to such a kiosk which doesn't infers the same meaning as  ATM. It's hard to tell though what such name can be given.

2. If a crypto ATM is successfully launched without any restrictions from any authorities how good would it be for us?
    Would it be worth it ? How do you think it will bring a change in India ?

2. So just in Case you are able to find the name for such ATM will it be worth opening such an ATM? Both for Company and the Customer. So blank on point looking at the current scenario of Cryptocurrencies in India it might not actually be such a profitable venture for the Company. There aren't many users who would be willing to go and withdraw hard cash for Bitcoin simply because the volume is pretty low. Moreover such a thing would be prone to safety also as I am pretty much sure no Police Station would cooperate with the Company in case of theft of cash from such a machine. Moreover, assuming there are cardless withdrawals. Trusting a public place to open up your Unocoin wallet would also not be something many people would be willing to do. And yes Authorities would still be continuously nagging with you regarding the status of such a thing. For someone like me I won't be much fascinated with such a thing either. With easy bank withdrawals I think it's much safer and easier to use banking channels to withdraw and then use Debit/Credit Cards for Purchase Transactions. Cash nowadays has much less usage in Places like Malls etc. So all on all I don't think it would be worth the headache unless you want to become the next big news headline of the country.

[chunnu39]

crypto atm I think it's an unnecessary product in the crypto industry because if I need to convert my crypto into fiat cash (INR), I will convert in local exchanges rather then using crypto atm. the crypto exchange is much convenient and easy. There are top 2 Indian exchanges that I use last 3 years wazirx and bitbns without any issue.

[CryptoInsights]

In India currently there is no much crowd that is buying and using Crypto. Thus, if there is a ATM somewhere in a corner of Bangalore will not cater to the actual crowd that is using Crypto. The security and maintenance would cost more then the actually buying through the ATM machine. Instead, the exchanges in India are much helping and easy to ue they are better than installing an ATM.

[Cryptogames999]

I would suggest you to check the stats of previous ATM which was removed by police. I am too interested to withdraw cash from Crypto ATM, but this will take more time and RBI should make it legal.

What is the exchange rate with this Bitcoin ATM and do we get same rate as on exchanges?

[webtricks]

I would suggest you to check the stats of previous ATM which was removed by police. I am too interested to withdraw cash from Crypto ATM, but this will take more time and RBI should make it legal.

What is the exchange rate with this Bitcoin ATM and do we get same rate as on exchanges?

I think you are mistaken. There isn't any new ATM. OP is talking about the one and the only attempted machine that Unocoin tried to set up as an ATM 1.5 years ago. Since that machine was forcibly removed by Karnataka Police, no other company/exchange set up any machine in India. So there isn't any exchange rate as there is no ATM.

[onrise]

I would suggest you to check the stats of previous ATM which was removed by police. I am too interested to withdraw cash from Crypto ATM, but this will take more time and RBI should make it legal.

What is the exchange rate with this Bitcoin ATM and do we get same rate as on exchanges?

I do not think in coming 1-2 years the country could have the ATM because the percentage of population using is not much. Also if government encourages it and make the digital payment including crypto as an option as well will get a boost and in coming time then we can expect to have more of the ATM machine which would be more useful in various cities.

[0zero0]

I would suggest you to check the stats of previous ATM which was removed by police. I am too interested to withdraw cash from Crypto ATM, but this will take more time and RBI should make it legal.

What is the exchange rate with this Bitcoin ATM and do we get same rate as on exchanges?

I do not think in coming 1-2 years the country could have the ATM because the percentage of population using is not much. Also if government encourages it and make the digital payment including crypto as an option as well will get a boost and in coming time then we can expect to have more of the ATM machine which would be more useful in various cities.

The current crypto situation in India is becoming better these days since the court has lifted up the ban on cryptocurrencies.
Also people are learning more about crypto these days due to lockdown.
I think, if there would be a global ATM/Kiosk for cryptocurrencies where anybody with a crypto card could just swipe and encash the money then there will be many people using this facility because not everybody would like to undergo the hassle of exchanging and converting online then encashing it.

[so98nn]

So if it isn’t illegal to set up a kiosk then I am really hoping that upcoming Indian giant like WazirX and also the former ZebPay shall renter the market with such machines.

Of course without any arbitrary process but proper communication with the RBI. Things will surely change in India after this since we know very well there are huge number of crypto users across India.

On the other hand it would be far easier for me to exchange BTC at the booth rather than going online and wrecking my nerves with some stranger until the P2P transaction gets completed.

After the uplifting of ban I guess it wouldn’t be that difficult to set one.

[fiulpro]

See the problem is not with the ATM's being installed , the problem is , the ban was just lifted and then unfortunately we got into quarantine , jobs are very less at the same time investors are highly unlikely to go out and sell their cryptocurrencies.
For 2 more years people will have to buy and sell Bitcoins like they usually do , trust me I have been using Zebpay since years and I have never seen any problems with anything except for the strict rules they put up . At the same time I do think that instead of ATM one can easily use an exchange.
ATM's can be used in a time of need but won't work :') we don't have that many active users plus they are diffused to various locations , the ATM won't be profitable and the company will inturn drop it after some years.

2 years for Corona virus to go
+
1 year for jobs to resume
+
1 year for people to start looking into crupo
+
1 year for companies to install ATM and all after doing research

- 5 years.

Plus its India I would make it 10 until and unless the company has money to speed it through.
ATM's will only work if there are bunch of them at good locations.

They should put in normal voting machines where people can vote if they need it or not and one with the Highest number of votes , that area ( might be Banglore or Delhi ) should get one established for trial run .

[so98nn]

Plus its India I would make it 10 until and unless the company has money to speed it through.
ATM's will only work if there are bunch of them at good locations.

They should put in normal voting machines where people can vote if they need it or not and one with the Highest number of votes , that area ( might be Banglore or Delhi ) should get one established for trial run .

Yeah that's a laughable and at the same time serious concern here. Corona has hit at worst time to India.

Tell you what you never know, in the next annual budget they may set out different guidelines for the Cryptocurrency because they might foresee use of crypto in wrong way.

Ex. Black money, Politicians putting their money over cyrpto's thus affecting the Indian economy which is already disturbed.

that area ( might be Banglore or Delhi ) should get one established for trial run .

It could be Mumbai and Pune as well. The metro cities with big time crypto crowd.

Don't forget our Gujarathi & Marwadi businessman's who are very much into crypto since long!! 

[suvo05]

Plus its India I would make it 10 until and unless the company has money to speed it through.
ATM's will only work if there are bunch of them at good locations.

They should put in normal voting machines where people can vote if they need it or not and one with the Highest number of votes , that area ( might be Banglore or Delhi ) should get one established for trial run .

Yeah that's a laughable and at the same time serious concern here. Corona has hit at worst time to India.

Tell you what you never know, in the next annual budget they may set out different guidelines for the Cryptocurrency because they might foresee use of crypto in wrong way.

Ex. Black money, Politicians putting their money over cyrpto's thus affecting the Indian economy which is already disturbed.

that area ( might be Banglore or Delhi ) should get one established for trial run .

It could be Mumbai and Pune as well. The metro cities with big time crypto crowd.

Don't forget our Gujarathi & Marwadi businessman's who are very much into crypto since long!! 

Gov definitely have a plan on bitcoin, RBI will go to the supreme court against the latest court order.
https://news.bitcoin.com/rbi-supreme-court-cryptocurrency/
I think if the next judgment would have the same outcome then GOV will bring a new tax policy for crypto coins.

The companies which are looking to install crypto ATM they will certainly wait for the final judgment to come.