Bitcoin ATMs: Banking crackdowns driving crypto for cash demand
Outside of developing nations, online crypto exchanges are the most popular method of buying and selling cryptocurrencies, but with worldwide regulatory crackdowns and increasing numbers of banks blocking crypto purchases, could we see an explosion in the use of crypto ATMs?
Steadily increasing in number since first being launched in2014, crypto ATM installations have scaled new heights this year, increasing some 71% since January. Recent data suggest that crypto ATMs are being installed at 52.3 machines per day with a total of 24,000 in operation across the globe.
With the number of trusted crypto exchanges available, you could be forgiven for asking if we actually need ATMs to purchase crypto, let alone why they are surging in popularity? The answer could lie simply in the increasing demand for Bitcoin and cryptocurrencies, but also the lengthy verification sign-up processes required by exchange platforms. In comparison crypto ATMs are the quickest and easiest method to purchase and sell cryptocurrencies, moreover, they are anonymous.
Add to that those that do not have access to bank accounts or are not tech-savvy and cannot easily access exchange platforms, crypto ATMs offer privacy and high-speed access to anyone around the world who wants or needs to purchase digital currencies.
Perhaps not unsurprisingly crypto ATM operators are targeting this very market, the director of marketing and strategy at Coinsource, Derek Muhney recently stated “Bitcoin ATMs are the best way to buy Bitcoin for an increasing target group of unbanked and underbanked”. Echoing those comments, Ben Weiss, CEO of CoinFlip stated that “Bitcoin ATMs function primarily to make crypto digestible and attainable to new users who may not understand the intricacies of cryptocurrency or blockchain technology” and Alex Mashinsky, CEO of Celsius noted that compared to hodlers and speculators, “tourist” users will be the ones to likely leverage a Bitcoin ATM.
With an estimated 1.7billion of the world, adult population unbanked it is easy to believe predictions that the number of crypto ATMs will multiply to 100,000 installed by 2025 and the industry expanding beyond $1.7 billion. But will the continued crackdown from the establishment and the banking sector drive even more people to choose to buy crypto with cash?
Just this week HSBC became the latest bank to suspend payments to the world’s largest crypto exchange Binance. The bank cited a warning from the UK’s financial regulator claiming the move had been made in order to protect their customers, stating “We’ve made this decision due to concerns about the possible risks to you.” Many in the crypto world were quick to comment on Twitter, questioning the bank’s true motivations in blocking customers from spending their own money how they choose and pointing out that the bank doesn’t offer the same “protections” for those customers that choose to spend their money elsewhere, such as online gambling.
Whatever HSBC’s true motivations might be, the reality is cryptocurrencies are not going anywhere, and attempts to curb their usage will only drive users to find alternatives. When it comes to crypto adoption, ATMs could have a significant role to play, primarily due to ease of use providing convenient access to cryptocurrencies to everyone.
This article is written by Lee Mockler for The London Crypto Exchange