Did you know that over a fifth of the US population has used or traded in cryptocurrency? If you’re looking to diversify your portfolio or make more secure retail payments, getting in on this trend is a sensible way to go. This is especially true when you trade in Bitcoin, the most popular digital asset that you can spend both online and in stores.
A crypto ATM is the most convenient and accessible way to access Bitcoin. Still, since it’s a matter of financial safety, it’s natural to wonder how secure these kiosks actually are. Read on to learn more about how Bitcoin ATMs work and why they’re the safest way to trade in crypto.
What Is a Crypto ATM?
In the most basic terms, a crypto ATM is an ATM that allows you to trade in Bitcoin. These kiosks look just like regular ATMs that deal in debit transactions with fiat currency. However, they’re made to let you easily convert cash to cryptocurrency rather than to let you withdraw fiat funds.
A reputable, professionally-operated Bitcoin ATM will be well-labeled. You’ll see text clearly denoting what the machine is for and who owns it. You can easily identify a Bitcoin ATM this way as well as by the different functions that it has when you walk up to it.
All you need to do is go to the kiosk, scan your driver’s license, scan your QR code, and insert the cash that you want to convert to Bitcoin. Wait a few minutes until the appropriate amount of crypto appears in your smartphone app. You can then log out of the kiosk and leave with the crypto that you bought within 5 minutes.
You can find these machines in many locations just like you could a regular ATM. They’re at grocery stores, gas stations, banks, and even some corner stores. Basically, if you could find a traditional ATM somewhere, it’s possible that there’s a crypto one, too.
What Are the Benefits of Bitcoin Kiosks?
There are many benefits to using crypto ATMs. The first is convenience. Because these machines are everywhere, they’re extremely accessible to those in almost every area of the US.
They also are extremely easy to use. All you need is a license, eWallet, and some cash. The entire transaction only takes a few minutes and there’s no hassle throughout the process.
Easier Investments and Sales
Bitcoin ATMs are also versatile because you can sell Bitcoin as well as buying it. This process lets you take Bitcoin from your eWallet and exchange it for the corresponding amount of cash.
This is great for investors who want to take out a larger sum of money than they initially spent on Bitcoin. You can go to the same ATM one year after buying $100 worth of crypto and remove $130 (assuming a value growth of 30%). It also is awesome for people who want to sell digital assets when in need of fast cash.
That’s another reason that using Bitcoin ATMs is great – they provide you with a way to access one of the 21st century’s best investments. Trading in Bitcoin is easier than ever before, and it can ultimately make you a lot of money.
Finally, Bitcoin ATMs are also great because they provide more control than alternatives. Online exchanges randomly pair a buyer with a seller, so you have no idea who you’re making a transaction with. When you use a crypto kiosk, there’s no other person involved in the transaction- there’s just a secure machine operated by experts.
Are Bitcoin ATMs Safe?
It’s natural to wonder whether Bitcoin ATMs are safe before using them. Luckily, this is one of the greatest benefits of these kiosks. There are a plethora of reasons that they’re secure machines that work to protect your personal and financial information.
When you use a Bitcoin ATM, you need to scan your ID before your eWallet’s QR code. This proves to the machine that you are the person linked to your crypto wallet so that you can proceed with the transaction. If someone were to gain access to the QR code and password, they could still not make a transaction if they didn’t have your driver’s license.
This protects you from theft and stops unauthorized users from getting into your account. Still, it brings up the question of whether the machine stores your information on the larger Bitcoin ATM network.
If this were true, your sensitive information would be accessible by anyone authorized to work with the machine. It also would be on a network that could potentially be penetrated by malware. You’re right to worry.
But fortunately, you have nothing to be concerned about! Unlike some online exchanges, Bitcoin ATMs save nothing. The scan of your ID is never stored on the machine and is erased the second that your identity is verified. This means that you’re safe in more ways than one.
What Makes Them More Secure Than Other Alternatives?
Another reason that Bitcoin ATMs are safer bets than alternatives is that they provide you with immediate crypto. You don’t need to wait a long time to get the Bitcoin that you purchase, nor do you need to wait to get cash if you make a crypto-to-fiat transaction.
This isn’t just important for convenience’s sake. If you make an exchange with someone online and are forced to wait a week, your chances of being duped increase. You won’t have much recourse to fall back on if the transaction was made several days ago and could find yourself out of luck after losing money.
Crypto ATMs can’t lie because they’re programmed and run by leading experts in Bitcoin. They also give users the same outcome every time. Since you can see the funds immediately appear in your eWallet, you also will know if there is an unlikely malfunction within minutes so that you can contact the ATM owner.
Network Safety Features
Another reason that ATMs are more secure than online exchanges is that they keep all information off the network.
We’ve already discussed how these machines store nothing, but did you know that this isn’t the case for most exchanges? Your ID and eWallet information must be stored on a network, and no network is 100% impenetrable. You could lose personal information to hackers or to unscrupulous anonymous trading partners.
Even if you choose a direct exchange where you choose the person you’re trading with, it’s possible to choose someone unscrupulous. Fake exchange websites are also a threat. So why take the risk?
This isn’t a gamble that you should make, especially when crypto ATMs offer a good alternative. You have the power to protect your financial safety.
What Security Measures Are in Place?
In addition to storing none of your data, there are also several security measures in place to keep the Bitcoin ATM network secure.
Each machine connected to the network comes equipped with multi-factor authentication features as well as firewalls. This is true of most Bitcoin ATMs, though the precise level of security will vary.
The network itself is operated by a reputable provider like ByteFederal who has appropriate credentials and experience. You’re not going to put your information into some random machine run by unknown and potentially unscrupulous vendors. You’ll know exactly who you’re exchanging with and who to contact if there is an issue.
Another way that the machine keeps you safe is by restricting the amount of crypto that you can buy or sell in a single day. The limit is usually between $1,000-$10,000 in fiat currency or its Bitcoin equivalent. This feature enhances your safety because even if someone does steal all of your security information, they can’t clear out your entire account at once.
Buy and Sell Cryptocurrency Securely
It’s natural to wonder whether emerging technologies are secure, and Bitcoin ATMs are no exception. Since they work with cash and connect to your eWallet, they have access to your sensitive information. Luckily, these kiosks are built to protect your information from third parties and keep your personal information safe.
Now that you know all about crypto ATM safety, it’s time to get more information on cryptocurrency and money management. Check out the “finances” tab on our home page to learn more about converting fiat currency to Bitcoin. You can also check out the “work” section to learn more about making cash that you can use to invest in the most lucrative cryptocurrencies.
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- Understanding the role of a Bitcoin exchange