8 or so years ago in uptown manhattan you'd see these btc ATMs in shady bodegas that I was convinced were being used for laundering money back, unless the frequenters of the surrounding methadone clinics were more astute investors than what I assumed.
Same thing in the UK. Groups of very suspect looking people feeding loads of cash into them in small grocery shops.
I think a lot of them actually stopped doing it because the ATMs themselves were becoming a huge crime target, with so much cash in them and not particularly hard to remove.
Eh, I always assumed bitcoin ATMs just looked for the stores that do things like Western Union, lottery tickets, parcel drop-off etc - i.e. businesses who want a secondary revenue stream which gets people into the store.
I thought the future was here, and it is, but for some reason it's on sale somewhere between not at all, and a 24% markup.
Apparently lucrative, or maybe not. I'm not sure how to read that if that's reflective of their costs, wishful thinking, preying on the inattentive, or all of the above.
A few years ago some of the ATM's I saw in the UK did have limits, KYC/AML, etc.
For any transaction worth a damn, you had to register an account online, provide ID, etc.
You would get a code via SMS when you used the machine to authenticate.
A few models had a built in passport scanner type thing and webcam, another had a fucking fingerprint reader.
It was pretty much the same level of KYC/AML you needed to transact at Coinbase or Kraken, but you could input or receive actual paper cash, which seems to have upset the regulator so those machines went away as well as the no-KYC ones.
> It was pretty much the same level of KYC/AML you needed to transact at Coinbase or Kraken, but you could input or receive actual paper cash, which seems to have upset the regulator so those machines went away as well as the no-KYC ones.
I don't think most of them have any kind of Chainalysis setup or that would kill the margins for most of the operators. Isn't it basically just a license scan, SMS code, and daily/monthly limits?
Why would they need Chainalysis? Is this just a UK thing? In US Kraken sells monero, which has limited to no chainalysis in theory; clearly it must not be a regulatory requirement.
No country has it as a specific regulatory requirement. In the US it is vaguely called maintaining an “adequate compliance program.” Blockchain analysis software is likely to be considered an important part of a compliance program by the government, especially when they are in the middle of a crackdown and new DoJ guidance is big on prosecuting this kind of thing (especially prosecuting individual compliance officers for AML failures). Pretty sure Kraken allowing XMR is a source of tension between them and governments too.
This all seems bizarre to me. I could go buy gold today with cash, melt it down to remove the serial numbers, and no one would have a fucking clue where it came from or where it is going. And it'd be way more reliable as a store of value and easy to exchange anonymously across borders.
You have to file export declaration when moving more than $2500 of anything out of the country (except personal stuff for vacations or whatever). You also have to declare gold when you enter if it's over a certain amount. Vague rules in the CFR (https://www.law.cornell.edu/cfr/text/31/1020.210) based off vague laws from the 70s and 80s are the basis of billions of dollars in fines collected by the government every year. This vagueness makes it possible for them to continually shift the goalposts without an act of congress, i.e. what passes for a bank compliance program in 2023 is much different than what passed in 2005 even though none of the underlying statutes have changed very much.
> It was pretty much the same level of KYC/AML you needed to transact at Coinbase or Kraken, but you could input or receive actual paper cash, which seems to have upset the regulator so those machines went away as well as the no-KYC ones.
I assumed they went away because they combined the fat markups of bitcoin ATMs with the KYC inconvenience of Coinbase.
You could but noone has managed it successfully. I imagine these ATMs were heavily used for money laundering/illict reasons, so probably with the KYC requirements the FCA requires the operators knew there would be no business and didn't bother applying.
Why would you pay punitive fees to an ATM operator to get bitcoin if you could just deposit the cash in your bank and buy 'normally' for many % less with a card/bank transfer?
This is not really news - these people just didn't get licensed. There probably never will be any more licensed operators in the UK because the FCA is creating increasingly onerous requirements. In America every week there are unlicensed money transmitter prosecutions including for crypto ATMs, Paxful traders, Hawaladars (and their Chinese equivalents), etc. You have to fill out a form on the FINCEN website, get a lawyer to give you a template compliance manual, and depending on your state do the same thing there. Not really a big deal.
Great question! I wonder if there are laws or loopholes that could make it ok, or how it compares to other forms of intermediary Exonumia/tokens[1] that can be exchanged for goods or cash? [2]
Probably people with not a lot of other options to turn crypto into some more liquid? IIRC most UK banks (including challengers) are completely hostile to anything crypto, so I'm not sure what options one would have.
Not really the case. Some have limits and bans but it is not across the board and many banks don't have restrictions. The issue is the bank is semi-responsible to refund if someone gets scammed and sends money to an exchange and they have been taking huge losses on this; so I imagine some are just blocking it instead.
I wanted to see what these were like so I decided to burn $20 at one once and see if I could get any crypto out of it. They do the full KYC experience, so you have to scan your ID, get a text message and respond, it was wild to have to do this whole process standing in a convenience store. I definitely assumed I was having my identity stolen. But my identity was not stolen, I did the KYC steps, inserted cash, and got a paper slip with a BTC address on it with my money. The fees were insane, I don't remember but it was probably like $5 in total fees for my $20 transaction.
Besides the low amount, it is where the cash go (your account) that is identified/traceable on normal (those that accept deposits of cash and even cheques are called "evoluted" here) ATM's.
I'm sorry that majority of crypto people, content and companies, made you think that way. Crypto offers and has potential to be more than that but fails to educate masses. Here is one fact, at very basic level, crypto helps sci-hub funded > more access to research and scentific writing. Also help people in 3rd world countries to hold usd equivalent (not perfect, yet). I know these are hard to see, while living in western economy with lots of access to things.
> Please tell that to the people who invested in their local currencies in Argentina, Lebanon, Nigeria and more.
Most people use crypto not to send money anyway so it has completely failed as a means of payment and as any legitimate viable use case.
To suggest that people in those countries should use a much worse solution akin to a ponzi or pyramid scheme so that they can lose even more money due to scams, ransomware and volatility is beyond laughable.
Crypto is a scam, I don't think we need more rugpulls, exchange meltdowns to understand this basic fact.
When I buy crypto I am buying a signed chain of custody of some quantity of imaginary unit of account on a distributed ledger. That's it. If you think it is something more you're only scamming yourself.
