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Cryptocurrency: Bitcoin ATMs are popping up to introduce people to crypto, though few use them

By on August 14, 2022 0

Although there are 31 cryptocurrency ATMs in the Golden Triangle, you would be hard pressed to see anyone using one.

The machines have appeared in gas stations, supermarkets and other visible areas over the past year, but according to several Columbus businesses that house the machines, they aren’t seeing much use.

Near the East Columbus Food Giant paylines is a Bitcoin Depot cryptocurrency ATM. Bitcoin Depot is an Atlanta-based cryptocurrency exchange company that converts cash into crypto. Store manager Dan Price told The Dispatch that his store installed the ATM about six months ago. Since then, he has hardly seen anyone use it.

“It’s very poor,” Price said of using the machine. “I imagine that when our contract is over, it will be removed.”

Riverhill Chevron store manager at 229 Main St. Jay Patel said his store got its Bitcoin Depot ATM in August 2021. At the time, the machine served about 10 people a month. This number has dropped to two or three, sometimes five per month.

“A lot of people were asking, but right now it’s kind of slow,” Patel said.

What is Cryptocurrency?
Cryptocurrency – “crypto” for short – is a largely unregulated digital currency, distinct from government-backed currencies. Virtual coins can be kept in a digital wallet or can be used for purchases.

According to Coinbase, the largest digital wallet service, Bitcoin was established in 2009 and is the first cryptocurrency. Since its inception, the value of a single bitcoin has fluctuated considerably. A Bitcoin was valued at 40 cents in 2010; in April 2022, it peaked at over $64,000. Current value is approximately $24,000.

While Bitcoin is the most recognizable cryptocurrency, over 19,000 different coins and currencies have been created according to a CNBC.com article.

What are Bitcoin ATMs?
Bitcoin Depot says it pays retailers like gas stations and grocery stores a monthly fee for using the space. To use the machine, customers log into their existing crypto wallet or create a new crypto wallet. Then they select one of three currencies: Bitcoin, Ethereum or Litecoin and an amount of dollars to convert. Once confirmed, the customer deposits dollars to purchase the crypto, paying a 10-20% service fee in the process. Purchased crypto coins arrive in their crypto wallet in three to five minutes.

Customers can also use the company’s mobile app as a crypto wallet and its website to purchase coins using a debit or credit card. Other crypto ATMs offer different currencies such as Dogecoin, Dash, and EOS.

The machines are marketed to new crypto investors.

“It stands out once and it’s just a repeat,” said Sydney Harper, marketing associate at Bitcoin Depot. “You keep passing it and you’re like, ‘I wonder what that feels like?’ It’s just a way to get people’s attention.

But is it a credible investment?
Assistant Professor and Ph.D. from Mississippi State University. of Finance, Brian Blank, told The Dispatch that cryptocurrency volatility acts much like a company’s stock. The added risk of crypto compared to traditional securities such as stocks and bonds is the fact that crypto is not backed by any centralized banking system or underlying asset.

One of the reasons people might choose to invest despite the risk is to protect themselves against traditional markets. For example, if most of someone’s money is lost in the stock market, they would still have invested in crypto.

Brian White

“If you’re in banking and you’re worried your industry is going to die out, you might buy crypto assets,” Blank said.

“Because if your bank ceases to exist, maybe those crypto assets will be more valuable in the future.”

Blank invests a very small portion of his portfolio in a cryptocurrency named Ether.

When Blank’s students come to him with an interest in cryptocurrency, he advises them to invest only what they are willing to lose.

Blank said cryptocurrencies are still primarily a mode of investment rather than a common means of payment for goods and services.

“They think the coin will gain value in the future,” Blank said. So if you think something is going to go up in value, you don’t necessarily want to trade it in for a pizza or something.

Blank also noted that young people are more likely to invest in crypto. Those who spend more time online feel more comfortable buying something intangible than older generations.

“I think younger people are more likely to be technologically savvy, more of their lives are happening online and digitally,” Blank said. “So they’re more willing to buy things that only exist digitally.”

What is the impact of crypto?
Blank sees the investment utility of cryptocurrencies like Bitcoin and Ethereum (the network on which Ether is traded) as the biggest impact on the community.

“People have assets that they use to save for something in the future,” Blank said. “Whether it’s retirement or otherwise, that’s another type of investment they can use.”

What are the prospects for these crypto ATMs?
The crypto is growing, but the shape it has taken around the world is unlikely to stay the same, Blank said. While he expects famous currencies like Bitcoin and more technologically updated currencies like Ether to still be around in five to 10 years, other currencies will fall.

In fact, the total market valuation of all cryptocurrencies is around $1.1 trillion, down from a high of $2.9 trillion in November 2021, according to coinmarketcap.com.

Blank also thinks that while crypto ATMs are here now, he’s not sure they’ll be used to much effect in the future.

“I guess existing crypto ATMs will be around for a long time,” Blank said. I don’t know if they will be used more frequently in the next 10 years than in the last 10 years.

There are currently 21 crypto ATMs in Lowndes County, four in Oktibbeha, and six in Clay, according to the various companies that own machines in the Golden Triangle.

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