Bitcoin ATMs have recently been used more frequently as a means of obtaining cash in exchange for Bitcoin. These machines enable the users to sell their Bitcoin and get back the equivalent amount in the regular currency which is quite easy and hassle-free. Although Bitcoin ATMs give you a convenient way of getting rid of your cryptocurrencies, there are some benefits and downsides of this method that you should know about. In this article we will discuss what it takes to withdraw your Bitcoin money through an ATM and the advantages and disadvantages of using the method.
To get more general information on how to withdraw your cryptocurrency for traditional money, you can also find out more on how to cash out bitcoin and other possible methods and platforms.
How Bitcoin ATMs Work
Just like conventional bank ATMs, Bitcoin ATMs work in the same way, but instead of dispensing cash from an account, one exchanges Bitcoin for fiat money. Such machines are available in different places including shopping malls, convenience stores and airports. These apps are normally easy to use and have a simple interface that the user can easily use. To cash out Bitcoin using a Bitcoin ATM, follow these steps:
Locate a Bitcoin ATM: Some other platforms that can be useful include the CoinATMRadar where one can easily locate a Bitcoin ATM near them. It is necessary to ensure that the machine has the ability of cash withdrawal since some of the Bitcoin ATMs do not offer this service.
Initiate the Cash-Out Process: Upon getting to the ATM choose the option that says sell Bitcoin or withdraw cash. The ATM will then produce a QR code that is the recipient’s wallet address through which you will be expected to transfer your Bitcoins.
Send Bitcoin to the ATM’s Wallet: The user has to scan the QR code with his cryptographic currency wallet and send the desired amount of Bitcoin to the ATM’s address. The ATM will then authorize the transaction and this may take some few minutes due to traffic on the network.
Receive Cash: Once you have confirmed the Bitcoin transaction on the blockchain, the ATM will spit out the cash equivalent of the Bitcoin which you have sold. There are certain machines which may give you a receipt or ask you to come back after a while to transact especially for confirmation purposes.
Benefits of Using a Bitcoin ATM
1. Fast and Convenient: Bitcoin ATMs are convenient and efficient when it comes to exchanging Bitcoin to cash especially if one is in dire need of cash. Almost every machine has an easy to use interface, and one does not require any prior knowledge of cryptocurrency to use it. The transactions are usually completed within minutes and this makes Bitcoin ATMs faster than transfers from banks or time taken to process transactions in exchanges.
2. You Do Not Need to Have a Bank Account: Another benefit that comes with using a Bitcoin ATM is that you can be able to cash out your Bitcoin without the need of a bank account. It can be useful for those who cannot utilize the services of conventional finance institutions or who wish to stay away from using a single point of control for their money. The other advantage is that one can approach the machine and withdraw cash directly hence making it convenient.
3. Anonymity and Privacy: Nonetheless, Bitcoin ATMs are relatively more private than the process of cashing out Bitcoin through exchanges, which usually demands the user’s identification in the form of KYC. Most Bitcoin ATMs accept smaller transactions and do not require users to provide much information about themselves, which is perfect for users who wish to keep their identity private while exchanging their Bitcoin for fiat.
The Disadvantages of Using a Bitcoin ATM
1. High Fees: However, the biggest disadvantage of Bitcoin ATMs is the high fees that are charged during the conversion process. The fee normally ranges from 7% to 15% for transactions in Bitcoin ATMs, and this is much higher than the conventional exchanges or peer-to-peer methods. As a result, these transaction fees will become quite significant when users withdraw a large amount of Bitcoin, thus making Bitcoin ATMs a costly approach to cash out.
2. Limited Availability and Locations: However, Bitcoin ATMs are still not as common as the standard ATMs as they continue to be introduced in the market. Sometimes it can be quite challenging to locate a Bitcoin ATM especially depending on the area that you are in. Some of them you may not even be able to get in some parts of the country especially if the area is rather rural or underdeveloped. In addition, there are certain hours of operation for the machines; therefore, one cannot cash out at any time of his/her choice.
3. Transaction Limits: Bitcoin ATM services might have a certain daily limit for transactions, and this means that you cannot withdraw a large amount of cash at once. This is quite a challenge especially if one wishes to convert the bitcoins to cash and withdraw a huge amount of it. For bigger transactions, you may be required to produce identification documents or utilize several machines in order to withdraw the entire amount and this could be tiresome.
4. Slow Confirmation Times: Although, the process of a Bitcoin ATM is fast, it does not necessarily mean that the transaction will be processed instantly as it also depends on the Bitcoin network. In cases of congestion on the network the confirmations might take longer and this will slow you down in your attempt to make a cash withdrawal. This is especially true if the Bitcoin ATM in question is one which requires multiple confirmations before it can dispense cash and this can only slow the process down further.
