2014-01-07

Co.Labs

The Bitcoin Startup Boom May Mean More Bitcoin ATMs

Machines that trade local currency for Bitcoin—without the headaches of an online exchange account—are starting to pop up in Asia.



A company called Robocoin plans to expand its Bitcoin ATMs into the Asian market, allowing people to withdraw the booming virtual currency as cash in Hong Kong and potentially Taiwan.

Robocoin, which already has a Bitcoin ATM deployed in Vancouver, says the machines make it easy for customers to buy and sell the cryptographic currency without dealing with the cumbersome online identity verification requirements of many online exchanges. The Hong Kong ATM could be online by the end of January, according to the South China Morning Post.

After TechCrunch reported earlier this week that Las Vegas company's ATMs might also be headed to Taiwan, financial regulators there said the machines wouldn't be allowed, since Bitcoin isn't recognized as a currency, according to Focus Taiwan, a local news organization.

Robocoin's ATMs take images of users' fingerprints, faces and government-issued IDs to screen out known terrorists and others on regulatory block lists and make sure users stay below anti-money-laundering regulatory limits. The Internet-enabled machines can automatically buy and sell the currency on exchanges such as Mt. Gox and either send funds to an existing Bitcoin address or generate a new virtual wallet, printing the necessary credentials on an ATM receipt.

The company said in a blog post it's processed millions of dollars in transactions through its Vancouver ATM, which lets customers of Waves Coffee Shop exchange Bitcoin and Canadian dollars.

"Over one half of the buy-transactions generated new wallets, suggesting that Robocoin continues to attract first time Bitcoin users," the company announced in November.

Robocoin sells the $20,000 ATMs to entrepreneurs who get a percentage of each transaction and, according to a recent report on Chicago news site DNAInfo, plans to have machines installed in that city and on the East Coast early this year.

Robocoin ATM owners in the U.S. need to register with the Treasury Department as money services businesses and obtain necessary state licenses, the company's said.

The cryptographic currency's value is again on the rise after prices plummeted last month, when regulators in mainland China forced the exchange BTC China to stop accepting Chinese yuan in exchange for Bitcoin.

Despite a turbulent year for Bitcoin's valuation, the cryptographic currency has proven a rich market for entrepreneurs, with API tracking site ProgrammableWeb reporting Bitcoin APIs among its hottest categories for 2013. The site lists 95 Bitcoin-related developer interfaces for developers, from Beatcoin, a toolkit for building Bitcoin-enabled jukeboxes, to Coinabul, which facilitates Bitcoin exchanges for gold.

Some services take advantage of the currency's mathematical properties for their own purposes. One, called Proof of Existence lets users mathematically prove a document existed as of a particular date by embedding its cryptographic fingerprint in the shared Bitcoin transaction record—a 21st century answer to mailing yourself a sealed copy of a time-sensitive document such as proof of an invention.

And Robocoin isn't alone in building Bitcoin ATMs—New Hampshire company Lamassu Bitcoin Ventures said last month it's received more than 100 orders for its machines that convert cash into Bitcoin from 25 different countries and shipped more than a dozen. Lamassu's highlighted the relative simplicity of its machine, though Robocoin's poked fun at makers of machines like Lamassu's that only accept cash and don't dispense it and aren't intended to be left unattended.

"Seriously, how bush league is an ‘ATM’ if it can’t do the equivalent of deposits and withdrawals or be left unattended?" Robocoin CEO Jordan Kelley was quoted as saying on the company's blog.

[Coin Tree: AG-PHOTO via Shutterstock]






Add New Comment

0 Comments