A dollar-converting Bitcoin ATM, which will accept the conversion of money to Bitcoin, has been created by New Hampshire entrepreneurs, Harvey and Matt Whitlock.
Bitcoin is a mode of exchange for use in restaurants, bars and grocery stores nationwide.
While traditional automated tellers dispense currency, these Bitcoin ATMs will accept tender using the same validation mechanism. The amount of U.S. dollars will be instantly counted and credit the user’s account.
Harvey and Matt Whitlock are partners in Lamassu Bitcoin Advisors, a New Hampshire-based venture which has ambitious plans of installing the Bitcoin ATMs in thousands of restaurants, grocery stores and bars all over the country.
Since its appearance in 2009, Bitcoins have become the Internet’s favorite alternative currency. Last fall, WordPress had announced that it would be accepting Bitcoins as a payment method. Some retail businesses like Cups and Cakes bakery in San Francisco have also agreed to accept them.
Currently, the exchange rate is at US$30 per coin, and is estimated that $300 million is in circulation. Harvey demonstrated the Bitcoin device to CNET recently at the Free State Project's annual Liberty Forum.
"It's even easier than just using a regular ATM," said Harvey. "You could probably do it in about five seconds. The thing that would take the longest would be the bill validator taking in the dollar. If we made these machines somewhere around $1,000 to $1,500 each, depending on the commission, they could be able to buy this and make it back within a reasonable period of time."
"Even people who have been in the Bitcoin world for a while and have used every type of exchange are blown away by the simplicity of this machine," Harvey added. "I'm just putting in a dollar. Before they really know what's going on, their phone tells them, 'You have Bitcoin.'"
The alternative Internet currency is an easy way to transfer funds across borders. Wire transfers comparatively are slow and the process of transfer is cumbersome. Relative to credit cards, Bitcoin can be bought anonymously and is less risky, as the transfer rail cannot be traced.
Normal currency is brought into existence at the whim of politicians and banks. Bitcoins is brought in and governed by mathematical algorithms, and is gaining particular popularity among activists and libertarians.
Harvey had been running an online Guitar business Stompromp.com in Tel Aviv. He came up with the idea of Bitcoin ATM because he felt accepting Bitcoins would be a safer medium compared to charge-backs and issues of credit card fraud.
Bitcoins can be obtained via Android’s BitcoinSpinner and iPhone apps like Blockchain, which show the ATM a QR code that has the desired payment address. Once a dollar bill is inserted, the ATM credits their Bitcoin account while charging a transaction fee of 1 percent.
Edited by Braden Becker