Yesterday, I spent a decent amount of time chatting with someone on the Coinsheet Discord server about how displeased people are at the amount of time it takes from the moment they buy BTC until they actually receive it (using Coinbase as the example). Instead, there are other ways to get BTC faster, those being with someone selling BTC at LocalBitcoins.com or using a BTM.
I tried a BTM for the first time yesterday. It's a BTM made by bitaccess with the CoinCloud ATM branding. I was excited to be a pioneer of sorts, to try and find a way to get $$$ into the crypto market faster than I could with Coinbase/GDAX.
I found a BTM locally and headed out.
The first thing I noticed with the BTM was that it looked nice. Big. White. Big screen. "New Tech". The next thing I noticed, after I started the transaction and verified myself using an SMS multifactor authentication (MFA), was that the buy price of BTC was about $16000. The real price of BTC at that moment in time was about $14800, a difference of about 8%. I was cool with that, I understand business, I understand that the owner of that BTM needs to make something for providing the service and convenience of instant BTC (well, near-instant).
Now comes the reason I'm writing this post. Unlike a traditional ATM, the machine never showed me what the fee would be. It never showed me that for $90, I would get x BTC. It never showed me that the transaction I placed had a size of about 467 bytes at a cost of 395 sat/B. It never showed me that the cost of this transaction was $27.18. The $90 I fed the machine ended up yielding me, at the time of the transaction, $55.95...a mere 62% of what I spent (net).
A few things I'd like to see from BTMs, to align them with how ATMs work:
- Show the realtime price of BTC and even the % you're losing by using the machine. Why not be transparent?
- Show the fee or estimated fee the transaction will have so the customer can make an educated decision on whether or not the convenience is worth it.
- Of course, getting your BTC in an hour or so is worth something as compared to getting it a week later. However, losing 30% right out of the gate is probably more costly than the price difference BTC would have between the time of your purchase and the time you receive it at a place like Coinbase/GDAX.
- Show the customer the NET amount of BTC they'll receive, including how much it's worth in realtime, just like my transaction shows.
Personally, if I owned an establishment that could house a BTM, I'd be all over having one. But, I would like to be more
transparent honest about it. I think this lack of transparency could be seen as a barrier for most people. Most people want to know what something costs. Most people want to see what the ATM charges as a fee... they show you. This transaction has a $3.00 fee. Are you sure you want to proceed?
DISCLAIMER: I am simply a cryptocurrency hobbyist. I work for no company that has any connection with cryptocurrencies, their networks, or their trading platforms. I wrote this article because I wanted people to know about BTMs and possibly be cautious about using them. If others before me have written about them and given fair-warning, I must have missed that message. Luckily, I only lost about $35 in doing this exercise. Still, $35 can feed a family all day, easy.