What is a bitcoin ATM?
A bitcoin ATM is a general term used to describe any device or machine that sells bitcoin. There are tens of thousands of bitcoin ATMs in the U.S. These include traditional ATMs where consumers can buy bitcoin using their debit card or cash kiosks where consumers can buy bitcoin using cash.
When you use a bitcoin ATM, you are buying bitcoin from the operator of the machine. A good analogy is buying bitcoin is like buying snacks from a vending machine. The vending machine operator goes and stocks the machine and you pay the machine for the snacks.
There are national bitcoin ATM operators like LibertyX that have coverage across the country as well as regional operators that focus on certain states or local markets. National operators operate more efficiently due to economies of scale and typically have better prices and a more uniform customer experience.
What is a bitcoin exchange?
A bitcoin exchange is an online website or app that allows consumers to buy or sell bitcoin from another individual on the same platform. Consumers place orders and the exchange matches buy and sell orders. Bitcoin exchange generally require you to link your banking information before making a purchase. This can be done via a wire transfer or sharing your online banking credentials.
You typically cannot use or move any bitcoin purchased on an exchange for up to 7-10 days while your payment is cleared.
Exchanges typically do not have live customer support and customers are required to use email or a form to submit a ticket for assistance.
Why should I buy bitcoin in-person?
Bitcoin is a new technology and many consumers are more comfortable buying financial products in-person. If you prefer buying groceries in-person over buying online than buying bitcoin in-person may be for you. Bitcoin ATMs are located all over the country, and there are likely several near you. There are many locators you can use to find bitcoin ATMs near you. LibertyX has one that features over 20,000 purchase locations that can be found here.
By purchasing from a cashier or an ATM, in front of you, you can have more confidence and trust as you can talk to a live person in case you have any questions or support issues.
How do I buy bitcoin?
1) First, you need a bitcoin wallet to store your bitcoin. These are generally free and can be on your mobile phone, laptop, dedicated device, or held by a third party. Some popular ones include Edge, Electrum, Ledger, and Coinbase respectively.
2) Then you provide your bitcoin address to the service you are using to buy the bitcoin. Generally you will be required to undergo Know-Your-Customer (KYC) verification before you can make a purchase. At bitcoin ATMs, this typically involves verifying your mobile phone number and scanning your drivers license. For online exchanges, your social security number is also required.
3) Finally, complete your payment (using cash or your debit card) and the bitcoin will be sent to your wallet address provided. You now own bitcoin!
Why does it cost more to buy bitcoin from a bitcoin ATM than from an online exchange (Coinbase, Gemini, Cashapp, PayPal, etc.)?
Bitcoin ATMs provide convenience and instant access to your bitcoin. The way they can do this is by accepting instant and irreversible payment methods to prevent fraud.
Cash and PIN debit cards are instant and secure payment methods so a company can send the bitcoin immediately after you pay and be confident they will receive the money. Bank transfers are reversible which is why online exchanges typically do not make the bitcoin you purchased available to you until 7-10 days.
There are higher costs incurred in processing cash (securing, counting, armored car pickup, etc.) and PIN debit card payments (hardware readers and POS terminals, Visa/Mastercard network fees) than bank transfers, so that is passed through in the consumer fees.
How much are the fees to buy bitcoin?
Companies generally charge fees in two ways: 1) stated fee 2) FX rate. The stated fee is either a flat fee (e.g. $4.95 per transaction) or a variable fee (e.g. 8% of transaction). Because there is no uniform price for bitcoin, some companies increase the price of the bitcoin (e.g. show $20,000 when the price on other services is $19,500). Customers should be aware and pay attention to the total fee when purchasing bitcoin.
LibertyX is currently running a promotion where consumers only pay a flat $4.95 fee for cash purchases up to $500 at CVS and Rite Aid stores. Learn more here
LibertyX generally has the lowest bitcoin fees nationwide. In most cities, the fee is 8%. LibertyX believes in transparency and does not inflate the FX rate like some other companies. The bitcoin price is shown at the top of the mobile app as well as in the menu bar, and updates in real-time so you always know what price you will be getting.
Other bitcoin ATM operators charge from 12% and to 20%+. Do your homework before purchasing bitcoin or you might end up with less than you expected!
Can I use cash or my debit card to buy bitcoin? Do I need to link my bank account or send a wire transfer?
Yes, for consumers who prefer to buy in-person or like the convenience and trust that comes from purchasing from a local store, being able to pay with cash or your debit card is a must. You can filter your preferred payment method types (e.g. cash or debit card) while searching for stores near you in the LibertyX app or at libertyx.com.
You do not need to link your bank account or send a wire transfer to use LibertyX. We know that some customers are uncomfortable providing online banking credentials so we designed our purchase experience to be as simple and straightforward as possible.
Learn more about buying bitcoin using your debit card from an ATM.
Learn more about buying bitcoin using cash or your debit card from a cashier.
Why do I need to scan my drivers license or photo identification when I buy bitcoin? Why do I need to give my name or social security number (SSN) to the bitcoin company?
Companies that buy or sell bitcoin from consumers are regulated in the U.S. as Money Service Businesses (MSBs) by FinCEN. One of the MSB requirements is perfoming know-your-customer procedures on your customers. As a result, legal bitcoin companies in the U.S. will ask for some of your personal information in order to confirm your identity before allowing you to complete your bitcoin transaction.
LibertyX offers a tiered system for consumers. For example, after creating your free LibertyX account, additional information may be required if your want higher purchasing limits or the ability to purchase from chain retailers (e.g. CVS and Rite Aid). Learn more about the different customer limits and levels at LibertyX.
Still have questions?
If you have any other questions about buying bitcoin, have burning recommendations on where we should add locations, or anything else, we want to hear from you!
- Email: [emailprotected]
- Phone: +1 (800) 511-8940
- Live-chat: Chat box on the lower right hand corner of the LibertyX Help Desk screen
