Despite what you may personally think about cryptocurrency, it continues to eek its way into our everyday lives. On Thursday, the Circle K convenience store chain announced that it has cut a deal with Bitcoin Depot to create a Bitcoin ATM network that will encompass more than 700 machines.
The company isn’t even waiting around for consumer buy-in; it has crypto ATMs installed in its stores across 30 states.
According to reports, the ATMs will work much like a regular ATM does, except for the fact that users are given instant access to bitcoins and more than 30 other cryptocurrencies.
Positives and negatives to Bitcoin ATMs
ConsumerAffairs reached out to Bryan Routledge, associate professor of finance at Carnegie Mellon University’s Tepper School of Business and an expert in Bitcoin regulation, to get his take on the crypto ATM nuance. His advice for consumers is this:
The advantage: “Bitcoin ATMs let you do some of the activities of banking without using a bank. In particular, you can take cash and convert it into Bitcoin. The advantage is that this is now digital (like a deposit at a bank) so you can send it to someone (sort of like a check) or withdraw it later,” Routledge said. “The benefit is you are not carrying physical dollars you might lose (with the cost that you need to secure your digital ‘wallet’ details or secure the printed receipt.”
The disadvantage: Routledge warns consumers that Bitcoin ATMs may have high fees. So while they might provide an alternative, it might not be that attractive for the time being.
“Second, not all ATMs are ‘two way.’ Some let you buy Bitcoin. But they do not have a sell Bitcoin for US dollars feature. Given Bitcoin has very limited use in everyday transactions, being able to convert your Bitcoin back to cash easily (and keeping an eye on fees) is important,” he said.
As any curious cryptocurrency watcher knows, an investment in cryptocurrency can go bad in a heartbeat. “The US dollar price of Bitcoin is stunningly volatile — $10,000 to $60,000 range just over the past year. If this is ‘rainy day savings,’ that volatility is difficult to bear,” Routledge said.
Beware of scams
Regarding possible trouble spots, ConsumerAffairs pulled back the curtain a bit at Bitcoin Depot’s website to find what other wrinkle consumers might face. In the company’s FAQs, it says that users can send money to someone through one of their ATM machines.
“You would need to send the Bitcoin from the machine to your wallet. From your wallet, you can send the Bitcoin to whomever you like!” the company stated. However, consumers should beware of the following statement too.
“Please be aware that ALL bitcoin transactions are final, meaning that we will not be able to reverse a transaction after you send it,” the company warns.
That alone could turn out to be problematic. Fraudsters are already leveraging scams with gift cards, but they’re also dipping their toes into cryptocurrency because of the finality of each transaction.
“Bitcoin Depot kiosks are meant to be utilized to purchase cryptocurrencies for your own [digital] wallet and not as a person to person transaction service,” or to pay the IRS, utility bills, or if someone says you are being investigated, Bitcoin Depot cautioned. “This policy is in place to protect our customers from potential scams. Most of the time a stranger asks you to send them Bitcoin, it is a scam.“