Bitcoin ATM? In a Kwik-E-Mart?
December 8, 2017 4:33 PM   Subscribe

OK, I do not understand Bitcoin and how normal people who are not setting up a murder-for-hire even use it. I'm picking up some candy at the local gas station/ convenience store, and they have a Bitcoin machine. Like an ATM, but for cryptocurrency? It takes cash. So, Bitcoin value is over $15,000 right now, I'm assuming people are buying tiny percentages of a Bitcoin and not stuffing 15K in an ATM.

What do they use it for? It's not an investment if you're buying $5 worth of Bitcoin, right? Who takes Bitcoin? Do they spend it on gas right there? And if so, why?
Since they obviously had money to buy the Bitcoin with in the first place. I am mystified and feeling very out of the loop, old and confused here, people. Can someone help me understand this?
posted by mmf to Technology (9 answers total) 2 users marked this as a favorite
0) bitcoin is stupid.

a) there's such a thing as a "bitcoin wallet". It's like a bank account for bitcoin. I'm pretty sure that the bitcoin ATMs let people deposit cash (US $) which is then exchanged for bitcoin at an exorbitant fee and deposited into their wallet. Or the same process in reverse. Theoretically it's an easier way to get access to/from bitcoin.

b) presently the smallest increment of a bitcoin is 1 satoshi, which is 0.00000001 bitcoin (much less than $.01).

c) fewer and fewer places accept bitcoin as payment right now because of its volatility and associated high transaction costs.
posted by booooooze at 4:57 PM on December 8, 2017 [6 favorites]

drugs. people use them for drugs. that, or money laundering (technically, money muling). bitcoin machines allow you to stay anonymous in your transactions. this makes them attractive for Certain Purposes.

like regular ATMs placed in convenience stores/bodegas, they often charge extraordinarily high transaction fees.
posted by halation at 5:03 PM on December 8, 2017

I don't think Bitcoin is inherently dumb, but as it currently is traded, it's more of a gambling instrument than anything else. The rampant speculation has rendered it all but useless as a currency (unless your entire supply chain uses BTC, which, uh, it doesn't). Add in recent increase in transaction times (see above: speculation) and it's basically none of the things that it was initially developed to be.

There *are* cryptocurrencies and blockchain implementations out there that don't suffer from the flaws that BTC has (Ethereum being the one that springs to mind), but since they're a lot less useful to speculators they haven't really entered the public eye as much. Funny how that works...

As far as the ATM: because it's a gimmick, and it's a good way for the owner to make a nice profit and "cash out" some BTC without having to pay someone else's fees.
posted by -1 at 5:09 PM on December 8, 2017 [1 favorite]

ATMs for Bitcoin also exist because people who are paying ransomware have to get Bitcoin to pay it in.
posted by randomkeystrike at 5:19 PM on December 8, 2017 [6 favorites]

If you have loved ones in Venezuela or somewhere else with weak banks and stringent hard currency controls (the bolivar has also fallen 99% against the dollar), bitcoin is godsend. As others have noted, the nominal value of a "single" bitcoin is irrelevant, despite the odd name, since a coin is typically indivisible, though see: pieces of eight. An ounce coin of gold is worth US$1250 right now and probably only good for buying houses or cars, but for practical purposes people use cash and coins in reasonable denominations.
posted by wnissen at 7:45 AM on December 9, 2017

If you have loved ones in Venezuela or somewhere else with weak banks and stringent hard currency controls

Do you actually know people in Venezuela for whom Bitcoin has been a godsend? Because this was a common thing that true believers pumped in /r/bitcoin back when they still pretended it was about helping people and not about their dreams of extreme wealth (they frequently ask each other "which color lambo" they're going to buy.) But the anecdotal evidence I've read says that it doesn't help the average person that much. Besides the obvious (why spend $100 worth of bitcoin if it's going to be worth $200 tomorrow? or $80 for that matter?) the Venezuelan minimum wage is ~136k bolivar a month + a 189k bolivar/month food bonus, but the cheapest smartphone is ~1,600,000 bolivar, so what I've heard is that taking a phone out to pay in bitcoin puts you at a big risk for mugging/theft. Maybe for the rich Venezuelans looking to move currency out of the country and avoid sanction restrictions, but for the average Venezuelan it doesn't sound that helpful.
posted by bluecore at 8:30 AM on December 9, 2017 [2 favorites]

Mod note: A few comments deleted; the question is really about the ATM aspect, not a general "what are your thoughts about Bitcoin overall?" kind of thing.
posted by LobsterMitten (staff) at 12:14 PM on December 9, 2017

Last spring I used a bitcoin ATM to put $50 cash into a paper bitcoin wallet. My intention was to use it to anonymously pay for a year of VPN service. I changed my mind, and didn't buy the service. Last week, I cashed out half of my bitcoin for $100. I'm letting the rest ride, fully expecting a crash.
posted by cameradv at 8:41 PM on December 9, 2017

I'm in the Triangle area, which is stuffed full of tech geeks who like this kind of thing and have cash to spend on it as a hobby. Bitcoin ATMs are convenient and don't require you to connect your checking or credit card.

I used a bitcoin ATM a few weeks back to buy a small amount, mostly just out of curiosity. I put in cash, the machine scanned my ID, and then sent the money to an online wallet I set up on my phone. I then sent it to a paper wallet (a "wallet" is really just a pair of numbers, kind of like an account number but not fixed with a specific bank), and plan to use it in an art project. I'll probably sit on it for a while (it's doubled since I bought it but could just as easily crash, but again.. I didn't really buy it to speculate; it's an art project).

For comparison, I bought a small amount of bitcoin from Coinbase, one of the online exchanges. In order to do it it I had to attest to a bunch of stuff and then wait while it deposited a couple of amounts into a credit card for verification. And then of course my bank freaked out about suspicious transactions so I had to contact them. Compared to that, the ATM was quick, convenient, and didn't require banking info, just a drivers licence (which is an NC requirement).
posted by media_itoku at 9:34 PM on December 9, 2017

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