Crypto ATMs are a growing trend in Northeast Ohio

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The next time you stop to refuel your car or pick up an item at the grocery store, you might also be able to buy from one of the growing cryptocurrency markets in a terminal. which looks a lot like a traditional ATM. . These terminals are even called crypto ATMs, a nod to the latest twist in the financial world.

According to Coin ATM Radar, a website that promotes and tracks cryptocurrency ATM activity, there are approximately 250 crypto ATMs set up at convenience stores and other retailers in Northeast Ohio.

But these machines don’t work like traditional ATMs. They don’t connect to a bank account where you can deposit a check or withdraw money. Instead, they are part of what are called peer-to-peer payment systems that allow you to exchange your currency – dollars, pesos, euros – into digital currencies such as Bitcoin, Ethereum, Dogecoin or the ‘one of dozens of others. These ATMs are also used to perform secure transactions which are encoded and stored on a network of computers using blockchain ledger technology.

Nick Fordos remembers people walking into his store, Everything Computers and Electronics on Madison Avenue in Lakewood, carrying envelopes containing thousands of dollars. They weren’t there to buy computers or pay for computer repairs. They were there to put their money into the cryptocurrency ATM which, until recently, was hidden in a corner of its store. He took it out because he wasn’t comfortable with people walking into his little shop with large sums of money.

Perry Kramer, managing partner of Retail Consulting Partners, a Boston-based retail management consulting firm, said the use of cryptocurrencies and their ATMs is growing rapidly.

“You know, there’s no one answer to why there’s adoption, but it’s definitely growing,” he said. “Think about the number of migrants and other people in the country, who work every week and send money home. there it might be worth more, and Big Brother can’t watch you. “

Kramer added that since ATMs take up little floor space – typically 2 feet by 2 feet – they don’t have to generate a lot of revenue for the store owner to be worth it. Fees paid by cryptocurrency exchanges that own ATMs range from $ 300 to $ 500 for rent, although in more active places the exchanges may offer the store owner a small percentage of the transaction amount.

“I would compare it to a Red Box (the video rental kiosks seen in convenience stores, drugstores and other retailers),” Kramer said. “Every time a retailer can get into something that makes a little money and doesn’t require any manpower, it’s a victory.”

Kramer also noted that retailers see cryptocurrencies helping their businesses in other ways. A retailer is happy, he said, if he doesn’t have to handle money or pay credit card fees. He said coffee retailer Starbucks now allows regular customers to top up their Starbucks cards using Bitcoin, the most popular cryptocurrency.

“The more you go downstairs and find ways to accept payments that have lower interchange rates than credit cards and less friction than cash, you know, it happens,” did he declare.

Ryan Howard, COO of Truenorth Energy LLC, which operates 145 convenience stores (and sells gasoline to 185 other independent operators), said the company has not installed crypto ATMs, but that ‘she had examined the products.

“The main reason for doing this is to make life easier for our customers, to provide all the hands-on activities, all the convenient products that they are looking for, and (crypto ATMs) would just be something in that sense,” he said. he declared. . Howard said that one of the reasons his company’s stores don’t accept cryptocurrency is that digital currencies are so volatile.

In addition to crypto ATMs, consumers can also connect to the world of digital currency at many Northeast Ohio supermarkets through the kiosks of Coinstar LLC.

Among the supermarkets that have Coinstar kiosks that connect to cryptocurrencies is Giant Eagle. The company declined an interview for this story, but spokesperson Brock Schmaltz provided an emailed statement: “At Giant Eagle, we are delighted to offer our customers a variety of services to deliver a shopping experience. unique and practical, ”the statement read. “In response to the recent increased interest in cryptocurrency, we are delighted to offer our customers the ability to perform Bitcoin transactions using the Coinstar machines which are available in the majority of our supermarkets.”

People use the machines to invest in cryptocurrencies, which have been a hot investment vehicle for the past twelve years. The value of a Bitcoin – the world’s first and most popular cryptocurrency – recently exceeded $ 47,000, with large swings up and down since its inception in 2009 to $ 1.

Crypto exchanges are a kind of broker that provides the client with the necessary secure connection to the internet to buy and trade cryptocurrencies. Users can create an account called a crypto ATM wallet, giving them a platform to exchange national currencies like dollars for digital assets. The best crypto exchanges offer good security and low fees, making it easy and safe to buy and sell digital currencies.

There was $ 2.2 trillion in digital currencies as of September 1, according to CoinMarketCap, a website that tracks currencies. Unlike national currencies such as the dollar, the value of a digital currency is determined by what the commercial market fixes to them.

To use a crypto ATM, a user logs in with a crypto wallet address and inserts money, which is sent to the wallet. If the user puts $ 1,000 into the account and the value of the cryptocurrency increases by 10%, the account holder can withdraw $ 1,100, less fees.

In addition to investing and speculating in digital currencies, ATMs have also been used by immigrants to send money to their families back home. It’s easier and faster than Western Union or other types of money transfers. They are also used by people who choose to avoid banks. Which means they also have a dark side, attracting money launderers and other schemers.

This dark side of cryptocurrencies is another reason Truenorth stores haven’t installed crypto ATMs in their stores, Howard said.

“At first there was concern that (ATMs) would bring negative activity,” he said. “So far, people I’ve talked to across the country have said it hasn’t, but there is a kind of fear. But so far, everyone I have I spoke said that was not the case. case there. “

Cryptocurrencies are regulated like any other means of transferring value. In July, the US Treasury Department appointed the first digital currency adviser to its Financial Crimes Enforcement Network (FinCEN), the agency that oversees and enforces the Bank Secrecy Act. Cryptocurrencies are part of what FinCEN calls “convertible virtual currencies” or CVCs.

The agency declined to comment for this story, but in an email, Jayna Desai from her Office of Strategic Communications referred interested parties to a 2019 notice, “Notice of Illicit Activities Involving Convertible Virtual Currency,” for obtain information about its policies.

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