As cryptocurrencies like bitcoin continue to grow in popularity as an alternative form of currency, more and more businesses are starting to accept bitcoin as a form of payment for their products and services. If you choose to accept this form of currency, you can even install a bitcoin ATM at your place of business, making it convenient for customers to pay by bitcoin or even enabling them to buy bitcoin as a courtesy.
Of course, bitcoin is a new concept in currency, and bitcoin ATMs operate differently than standard ATMs as a result. Before you install one in your business, you need to understand how to use it yourself — especially considering you may have to explain to your customers how it works. So let’s do a quick crash course on how to use a bitcoin ATM.
The Basic Concept of a Bitcoin ATM
Bitcoin ATMs run on a similar concept to conventional cash ATMs in that they are both exchange platforms. A conventional ATM gives you cash in exchange for initiating a withdrawal from your bank account. A bitcoin ATM lets you exchange physical currency for cryptocurrency using either cash or a credit/debit card. The process is different for each type of ATM, but understand that the basic concept is the same.
Your Bitcoin Wallet
The next thing to understand is how bitcoin is stored once you purchase it. When you use a cash ATM, the machine spits out cash that you presumably place in your wallet. In similar manner, when you buy bitcoin, that currency must also be stored in a “wallet” — in this case, a digital wallet. This digital wallet is identified by a QR code which most users store on their smartphone. (Remember, bitcoin is essentially data.)
The reason this is important is that when you use a bitcoin ATM, the machine needs to know where you plan to store the bitcoin. If you already have a digital wallet, it will ask to scan the QR code from your smartphone. If you don’t have a digital wallet yet, it can generate a new wallet for you, creating a new QR code for you to print out or scan.
Using the Bitcoin ATM
The specific process of buying bitcoin may be slightly different depending on the type of ATM machine you’re using — but the general steps to making a purchase are as follows:
- You select “Buy.”
- The machine asks to verify your identity in some fashion. (Quite often this happens by asking for your mobile phone number and texting you a verification code.
- The machine prompts you for the QR code of your digital wallet. You can usually provide this by opening up the QR code on your smartphone and holding it up to the scanner. (Again, if you don’t have a digital wallet, the machine can generate a unique QR code for you.)
- If the machine offers several types of cryptocurrency (other than bitcoin), it will ask you to select which type you which to buy.
- You will be prompted to insert cash for the purchase (or in some cases, you can purchase using a debit or credit card).
- You select “Send coin.”
- The machine transfers the bitcoin to your digital wallet.
- The machine provides confirmation of your purchase. This may be by printed receipt, asking you to scan the QR code from the screen, or both.
At this point, you can use the bitcoin in your digital wallet to make purchases with any company that accepts this form of currency.
Bitcoin is now being accepted by a growing number of businesses from boutique online stores to national fast food chains. If your business accepts bitcoin as a form of currency, installing a bitcoin ATM makes perfect sense because it makes it easy and convenient for your customers to obtain it — not to mention you receive a percentage of the exchange rate. To learn more about how a bitcoin ATM can help your company, call National ATM Wholesale at 1-866-295-2329.