When Bitcoin (BTC) first came out in January 2009, its initial value was $0. From nil, its worth climbed to 10 cents in October 2010. Then, in February 2021, it surpassed its then-highest-recorded value of $48,000.
So, it’s no wonder cryptocurrency investing grew even more popular in 2021. Back then, 23% of U.S. adults owned and invested in crypto, including BTC, the first-ever crypto. That’s a 7% increase from the previous year’s 16% ownership and investor rate.
The increase in Bitcoin ATM machine availability has also spurred that growth. Transactions with these electronic kiosks take minutes, whereas online exchanges take days. ATMs also let users transact with cash; traditional channels require bank accounts.
But while easy to use, Bitcoin ATMs aren’t as straightforward as traditional bank ATMs.
Don’t worry, though, as this guide can help you get started on using Bitcoin ATMs. Read on for tips to get the most out of every transaction you make with these electronic kiosks.
1. Mind Your Keys
Investing in Bitcoin and other types of crypto requires using two keys: a public and a private key. Both are strings of alphanumeric characters that act as a pair and fit together.
You can think of a public key as an address to a mailbox; you need one to send and receive crypto. That also makes it safe to share with others if you want to buy or send them crypto.
In contrast, a private key is like a key that unlocks the mailbox. Always keep this to yourself, lest you want others to meddle with your Bitcoin.
When you use a Bitcoin ATM to send BTC, you need to use your private key to authorize the transaction. You also need the recipient’s public key to ensure the ATM sends it to the correct “mailbox.”
When withdrawing Bitcoin via an ATM, you also need your private key. That validates your identity, confirming your right to encash the cryptocurrency.
2. Get a Mobile Crypto Wallet
All cryptocurrencies you own, including Bitcoin, live on the blockchain. So a crypto wallet doesn’t store the crypto itself; instead, it keeps public and private keys. Thus, it allows you to access and manage your digital currencies safely.
There are several types of crypto wallets, but a mobile one may suit you best when using a bitcoin ATM.
A mobile crypto wallet is a software program you download to your smartphone. Many of these apps require creating an account with the platform first. Some may also ask you to provide personal information, like your name and mobile number.
Once you’ve set up the app, you can use it to generate the codes (usually in QR form) that Bitcoin ATMs require.
3. Choose a Wallet Supporting Different Cryptocurrencies
Many Bitcoin ATMs support other cryptocurrencies, like Ethereum (ETH) and Dogecoin (DOGE). These three are the most popular digital currencies and the most volatile.
For example, BTC’s price was $10,000 in late July 2020 but skyrocketed to $60,000 in April 2021. It then dropped again to $30,000 in July 2021. As for DOGE, its worth ranged from less than a penny to 73 cents throughout 2020 and traded at 24 cents in October 2021.
Because of their volatile nature, it pays to invest in more than one type of crypto. So aside from BTC, you may also want to own ETH, DOGE, and other digital currencies.
Fortunately, you can manage all your cryptocurrencies using a single crypto wallet. Just make sure the one you choose supports various types of crypto.
4. Look for Bitcoin ATMs Near You
After setting up your crypto wallet, you can start searching for Bitcoin ATMs near you.
If you live in the U.S., lucky you, as it’s home to over 30,000 crypto ATMs. There are also 2,000+ ATMs in Canada, so if you’re in North America, you won’t have a hard time finding one nearby.
To simplify the search, turn on your device’s location tracking service first. That allows for more accurate results. You can then look up “Bitcoin ATM maps” or “crypto ATM locations” online.
Once you get the search results, choose one of the websites with mapping services. These sites often let you input specific location details, such as your exact address. Use this to your advantage to get more info on the nearest crypto ATMs, including their address.
5. Confirm the ATM Supports Your Desired Transaction
Before going to the nearest Bitcoin ATM, check the type of transactions it supports first.
If the Bitcoin ATM is unidirectional, it only supports one-way transactions. If you use this, you can only either buy or sell BTC or other cryptocurrencies, not both. Most unidirectional ATMs often only allow crypto purchases, though.
If the Bitcoin ATM is bi-directional, it means it supports both buying and selling. So if you want to perform both transactions consecutively, choose this type of crypto ATM. Most of these machines also allow transactions with other cryptocurrencies.
6. Always Time Your Transactions
As Bitcoin is volatile, it’s in your best interest to check the current exchange rates first. That’s because the FX rate you see one day may be much higher or lower than the following day. A perfect example of BTC’s volatility is when its value dropped by 30% in a single day back in May 2021.
So before making a Bitcoin ATM transaction, take the time to see how the crypto’s value is faring. Then, as much as possible, only make cash withdrawals when the exchange rates are high. If you’re buying, though, consider waiting until its value drops so you can get more BTC for your cash.
7. Verify and Compare ATM Transaction Fees
All Bitcoin ATMs charge fees often based on a percentage of a transaction’s value. These charges vary widely, with some as low as 4% and others as high as 20%. But according to online estimates, the typical range is between 9% and 12%.
Bitcoin ATM charges are for cash handling and hardware and software maintenance costs. They also rely on those fees to meet federal regulations and volatility fluctuations.
Fortunately, reliable Bitcoin ATM providers often provide fee breakdowns on their websites. So once you locate nearby ATMs, pick at least three and check their rates online. Then, choose the one that charges the least.
Ensure you bring enough to cover the fees, as the ATM may not deduct these from your transaction. For example, suppose you want to buy $100 worth of BTC, and the corresponding fee is $15. In that case, you must place $115 in the cash receptacle for your transaction to go through.
8. Search for Bitcoin ATM Discount Coupons
Bitcoin ATM operators offer promotional codes, too, such as discounts for ATM fees. With these, you pay less or have the option to convert your “change” into BTC.
Crypto ATM discounts aren’t always available, so when you get one, use it for a heftier transaction.
You can find discount codes online, usually on specific Bitcoin ATM operator websites. You may have to register online; for instance, if you’re a new user, you may need to sign up to get a discount code. But it’s worth the effort, as some codes give you up to 20% discounts for your first Bitcoin ATM transactions.
You might as well sign up for Bitcoin ATM newsletters, too. They keep you updated on the latest ATM fees and, sometimes, contain promo codes.
9. Check ATM Transaction Limits and Restrictions
Many Bitcoin ATMs have minimum and maximum purchase and selling limits. For example, some may only allow you to buy at least $100 worth of BTC.
As for the maximum, some machines may have first-time user restrictions, such as a max of $300. After that, they usually increase the limit to at least $10,000.
You’d want to know those limits to make the most of your trip and avoid bringing too little or too much cash. Some ATMs may also require additional proof of identity for higher transaction amounts.
Another restriction you may encounter is the ATM’s accepted mode of payment. Most only allow cash; few accept credit and debit cards. The machines may also reject notes if they’re too old, crumpled, or torn.
There may also be restrictions on the monetary value of the notes you use.
For example, some Bitcoin ATMs don’t accept $1 bills and coins and don’t dispense change. If you want to pay the exact amount, the smallest bill you can use is $5. Thus, if the total amount is $115, you can use a $100 bill, a $10 bill, and a $5 bill.
What happens if you insert more money than your total purchase “bill?” Don’t worry; the ATM converts it into BTC. So you should see the converted amount of your change added to your crypto purchase.
10. Bring a Valid Photo ID
Most Bitcoin ATMs require photographic authentication when withdrawing and selling BTC. Many prefer a driver’s license, but you can also use your passport. Alternatively, you can use a government-issued ID with your photo and signature.
11. Register With the ATM
Once at the ATM, you must register to “tell” the machine your specific Bitcoin account. Registration steps vary, but most require you to provide your mobile number first. The ATM then sends a text message containing a unique code to the provided number.
You must enter that code into the ATM before proceeding with the transaction. No code, no BTC buying or selling. That’s why you should always have your smartphone whenever transacting with crypto ATMs.
Another reason you need your smartphone when using a Bitcoin ATM is to link it to your crypto wallet. To do this, you must generate a code, such as a QR code, from your wallet. You then scan that into the kiosk since it contains your public key.
So without your phone, you’ll be unable to tell the ATM your Bitcoin address.
Your mobile crypto wallet also has your private key; without your phone, you won’t have access to this code. If you don’t have the code, you won’t be able to buy, sell, or withdraw from the ATM.
If your transaction requires a photo ID, you only have to put it up to the ATM’s camera. After scanning your ID, the machine may ask you to take a selfie using its camera. It then compares your ID with your selfie to confirm your identity.
12. Double Check Your Transaction Choices
That’s even more crucial if you use an ATM supporting different cryptocurrencies. If you make the wrong selection, you might end up with ETH or DOGE instead of BTC.
Double-check the crypto wallet you’re using, too, especially if you have more than one. Remember: this wallet contains your public key, the address to your crypto account.
So if you have a wallet for BTC and another for ETH or DOGE, ensure you link the ATM to the BTC one. Otherwise, you’ll encounter problems if you try to buy BTC and tell the ATM to send it to your ETH wallet.
Just as vital is to confirm the amount you enter into the ATM is correct. Accidentally sell too much, and you’ll likely regret it if BTC’s value skyrockets within a few days. Likewise, you may regret it if you sell too little and its exchange rate drops considerably.
Once you’ve confirmed all your choices are correct, proceed with the transaction. Then, wait for the ATM’s successful confirmation, which may take a few minutes.
After that, check your wallet to ensure the transaction went through without issues.
Start Looking for a Bitcoin ATM Machine
As you’ve learned in this guide, a Bitcoin ATM machine provides a safe and quick way to make BTC transactions. However, it can be expensive compared to online exchanges.
So if you want to buy, sell, or withdraw now, choose an ATM with the lowest transaction fees. But if you’re okay with waiting a few days, consider making your transactions online. Their rates are cheaper, often only a fraction of what ATMs charge.
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