Bitcoin ATM Deposit Exchange Rate shocks

tread93

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Quote from: Nwada001 on March 02, 2023, 08:51:40 PM

Hearing about Bitcoin ATM machines in advanced countries makes me think it's the best and cheapest way to deposit and send crypto, especially for those who know little about crypto and don't want their identity revealed when buying it.

My cousin over in the U.S. wants to send me a few dollars from the US down here.
I suggested she buy cryptocurrency and send it over because the exchange rate is higher when I receive it in cryptocurrency rather than a direct bank deposit (CBN). She decided to use the ATM to deposit Bitcoin because it was closer to her and easier to use—no identity verification was required.

I just went through the receipts today and realized the machine price rate is far different from the real market price of 30,130 USD per bitcoin.

Out of the $1,000 deposited in cash
BTC worth $7,000 was only deposited to the provided address.
The same thing happened with 1,800 dollars' worth of bitcoin, and only 1377 dollars' worth of bitcoin was received at the address.
People's necks are being cut by these machines.

If this is how it's normally charged.. then I can't advise anyone to use ATMs to deposit bitcoin but rather buy a Bitcoin crypto card from Walmart shops.

Anytime you go to use a BTM there will be a 10-25% for the use of the machine. This is not ideal but if you have no other option then it’s good. Most legit operators are required to verify your identity and have KYC and AML in place. If not then it’s a sketch company who will eventually get shut down by US regulators. Just this week Bitcoin of America got shut down

death69

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Oh boi, aint technology a real wunder? One minut we're givin props to Bitcoin ATMs for bein all convenyent and low-key, and then the next thang you know we're all like "screw these mashines, they're just tryna play us". Ya know what they say, "with grate power comes grate responsibility" - but it seems like these mashines aint livin up to they're end of the bargan.

But let's not loos sight of the biger pitcher, ya feel me? This is just anuther example of how the world of crypto currency is still in it's baby stages. We're still tryin to figure stuff out, still testing the waters, and yeah, we'll make mistayks. It's like watchin a baby try to walk, they're bound to trip and fall, but eventually, they'll get the hang of it. And I got faith that we'll do the same with crypto currency. We'll learn from our mistayks and create a more dependable and trust-worthy system. In the meantime, let's not get too caught up and just enjoy the ride

DaveF

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Since someone made a private comment to me:

Quote from: DaveF on March 03, 2023, 07:08:56 PM

....
Take out the cost of running the back end network.
...
Take out the cost of running the back end server.
...

Saying I listed the back end twice, the answer is no I just did not express it properly:

The back end 'network' is all the back end infrastructure you have to run to keep your office and the BATM BUSINESS running.
The back end 'server' or servers is what you need for the BATMs to talk to the outside world and send & receive transactions.

For the sake of security should be separate and discrete setups.

Too often they are not separate as they should be, but even so there are still a ton of costs to run BATMs

-Dave

Rikafip

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Quote from: masyari on March 04, 2023, 05:34:25 AM

Bitcoin ATM is the worst method to enter in crypto

Care to elaborate that further? Just keep in mind that not all crypto ATMs have ridiculously high fees like the one OP mentioned.

Imho, there are far worse ways to buy your first crypto, like buying it from centralized exchange where you have to go through KYC.

tranthidung

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Quote from: jackg on March 03, 2023, 10:02:31 AM

The best method here is either to use a dex or use p2p exchanges (ie there's often people here trying to sell or buy).

P2P trading is risky too as scammers are abundant to wait for naively newbie P2P trade partner to join their scam traps.

Quote from: GazetaBitcoin on March 03, 2023, 06:10:36 PM

Actually no... it's not cheapest way and also not best way. It's a good way, but not best.

I used to feel very cool to read news about Bitcoin ATMs in my nation when I was a cryptocurrency newbie. It gave me feeling like Bitcoin is something really real, touchable and not something 'virtual' like local media wrote about Bitcoin. I felt more convincing about Bitcoin and honestly as well as fairly to say Bitcoin ATMs have good contributions to bring Bitcoin to more people. Contributions can be online exposure, belief like I have or physical experience like OP or someone in my local area did with Bitcoin ATM at Pizza store.

It's cool and as I said previously, in their review video, they tried with small amount!

masyari

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Bitcoin ATM is the worst method to enter in crypto

Nwada001

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Quote from: Pmalek on March 04, 2023, 05:01:03 AM

Quote from: Nwada001 on March 04, 2023, 04:42:20 AM

Trying to figure out a physical shop where she can buy Bitcoin or any other cryptocurrency that can be sent via card in case there's a next time.

Have you considered having your cousin use a decentralized exchange like Bisq? It's harder to set up and get used to for those familiar with centralized exchanges, but there is no KYC and no withdrawal fees like with CEXs. In theory, she wouldn't even have to send you the coins after a successful trade if you want to save some more on transaction fees. Bisq is also a non-custodial wallet, where you generate a seed to store the coins you use in connection with the app. That seed could be encrypted and sent to you. I don't recommend sending and storing such data digitally, but it still remains an option.

Some P2P alternatives are https://hodlhodl.com/ or https://localcoinswap.com/.

This would be a great help.
Let me give it a try first, then see how it works so that I will have a wider knowledge base when explaining it to her.
I like testing and experiencing something first before recommending it to someone else.

Pmalek

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Quote from: Nwada001 on March 04, 2023, 04:42:20 AM

Trying to figure out a physical shop where she can buy Bitcoin or any other cryptocurrency that can be sent via card in case there's a next time.

Have you considered having your cousin use a decentralized exchange like Bisq? It's harder to set up and get used to for those familiar with centralized exchanges, but there is no KYC and no withdrawal fees like with CEXs. In theory, she wouldn't even have to send you the coins after a successful trade if you want to save some more on transaction fees. Bisq is also a non-custodial wallet, where you generate a seed to store the coins you use in connection with the app. That seed could be encrypted and sent to you. I don't recommend sending and storing such data digitally, but it still remains an option.

Some P2P alternatives are https://hodlhodl.com/ or https://localcoinswap.com/.

Nwada001

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Quote from: Rikafip on March 04, 2023, 04:36:35 AM

Of course exchange rates are shown, but if you send a person that has no idea about bitcoin market price, what else did you expect to happen?

That's a mistake from my end, and it won't repeat itself again. Trying to figure out a physical shop where she can buy Bitcoin or any other cryptocurrency that can be sent via card in case there's a next time.

Rikafip

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Quote from: DaveF on March 03, 2023, 07:08:56 PM

It's not 5K. The more BATMs you add the easier that number becomes, but some things do get bigger. More support staff / workers in general. More insurance costs. At $50k BTC you can go with a lower percentage. And if your machines are moving more then 2BTC a month you can go with a lower percentage. But at these low levels, it's a tough call.

I used to think that they must be making crazy money, but since I was a regular customer at one BATM I had an opportunity to talk with the owner and after he told me all the expenses he had I realized that situation is very different from what I initially thought. Still, that's not my problem so if I can choose an alternative method and save a couple of %, of course I will go for that. Now, I only use it as a last resort sort but luckily that happened only few times in the last 3 years.

Quote from: Nwada001 on March 04, 2023, 03:44:58 AM

I believe someone with crypto experience cannot make the kind of mistake she made, though. Because she could have checked the price carefully, I believe exchange rates are shown before any transaction is made. er.

Of course exchange rates are shown, but if you send a person that has no idea about bitcoin market price, what else did you expect to happen?

Pmalek

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You could have used an electronic wallet like Wise. She opens a Wise account deposits money and sends it to you. Wise to Wise transactions in the same fiat currency are free. After you get it, you either withdraw it to your bank or debit card. Assuming, of course, that Wise, Skrill, or similar services work in your country.

Nwada001

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Quote from: Pmalek on March 04, 2023, 03:58:57 AM

You could have done it for her. You are the one that has experience with bitcoin, not her. The Bitcoin ATM map allows you to enter any city and shows the locations of ATM machines. After that, it's just a matter of finding the one with the lowest fees that is still operational.

Wish I was close to her their should have not been need for the Deposit in the first place, just wired transfer.
Am in Nigeria why she base in the US.
Was the one who suggested she send money over through crypto instead of Bank deposit into my local bank here because the exchange rate is nothing to write about.

Pmalek

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Quote from: Nwada001 on March 04, 2023, 03:44:58 AM

I believe someone with crypto experience cannot make the kind of mistake she made, though. Because she could have checked the price carefully

You could have done it for her. You are the one that has experience with bitcoin, not her. The Bitcoin ATM map allows you to enter any city and shows the locations of ATM machines. After that, it's just a matter of finding the one with the lowest fees that is still operational.

Nwada001

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I believe someone with crypto experience cannot make the kind of mistake she made, though. Because she could have checked the price carefully, I believe exchange rates are shown before any transaction is made. I will have to ask her the location of the ATM and its name, if possible, so that people can be warned about the high charge and all that.
Is there any physical shop where one can buy Ballet Crypto wallet cards that can be deposited directly into one's wallet?

Quote from: jackg on March 03, 2023, 10:02:31 AM

The best method here is either to use a dex or use p2p exchanges (ie there's often people here trying to sell or buy).

If am the one buying that could have been my best option, but she is the kind of person who do like going through stress of registration, verification and all that just to buy something which she want to send over.

DaveF

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Quote from: Rikafip on March 03, 2023, 05:20:22 PM

Quote from: DaveF on March 03, 2023, 07:22:07 AM

Last time I was dealing with this they could not set the price just the percentage above for the buy and the below for the sell they wanted which would show as the price.
Which is kind of the same thing as setting the price BUT as the price goes higher their percentage becomes a larger number.

Yeah that makes sense. Looking at cointamradar, I always thought that you guys in the US have much better terms simply due amount of ATMs (more competition, better terms for users), but for whatever reason fees are more reasonable over here. In one of the earlier posts you said that Bitcoin depo usually have fees in 10% range, while I quit my BATM for increasing fee from 4.5 to 6% lol.

The catch is (sort of anyway) that lets say BTC is at $25k if a BATM is moving 2BTC a month then you are in *theory* making $5k a month at 10%
Take out the cost of rent in the space in the store.
Take out the cost of running the back end network.
Take out the cost of having people load and unload the cash from the machine.
Take out the cost of the machine itself.
Take out the cost of the 4g service for the machine to communicate.
Take out the cost of having office space and staff for your help desk people.
Take out the cost of running the back end server.
And so on....

It's not 5K. The more BATMs you add the easier that number becomes, but some things do get bigger. More support staff / workers in general. More insurance costs. At $50k BTC you can go with a lower percentage. And if your machines are moving more then 2BTC a month you can go with a lower percentage. But at these low levels, it's a tough call.

Quote from: Rikafip on March 03, 2023, 05:20:22 PM

Quote from: DaveF on March 03, 2023, 07:22:07 AM

Last time I was dealing with this they could not set the price just the percentage above for the buy and the below for the sell they wanted which would show as the price.
Which is kind of the same thing as setting the price BUT as the price goes higher their percentage becomes a larger number.

Yeah that makes sense. Looking at cointamradar, I always thought that you guys in the US have much better terms simply due amount of ATMs (more competition, better terms for users), but for whatever reason fees are more reasonable over here. In one of the earlier posts you said that Bitcoin depo usually have fees in 10% range, while I quit my BATM for increasing fee from 4.5 to 6% lol.

Quote from: DaveF on March 03, 2023, 07:22:07 AM

As for anonymous SIM: https://silent.link/#generic_price_table there are also a ton of others and you can still walk into a lot of places and get a cheap disposable prepaid phone.

Yeah I know about these services, I am using Hush app for virtual number but from my experience that's not something that an average person use (and OP's cousin probably didn't use it either).

You can walk into Target or Walmart and get a prepaid SIM and set it up with just about any info you want to give them to activate.
https://www.target.com/p/mint-mobile-7-day-trial-kit/-/A-54444205

-Dave

thecodebear

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Not surprising, I've always assumed Bitcoin ATMs have awful rates, though that does seem a bit high haha.

I mean the ATM company has to get enough money just from fees to cover the cost of creating, servicing, and transporting these machines.

The only reason to use a Bitcoin ATM would be if you want to keep your Bitcoin entirely private which you can't do through exchanges. And localbitcoins just shut down so I think there's only now a couple small online options for privately acquiring Bitcoin and they also from what I've seen have their Bitcoin marked up by a few thousand dollars though $30k cost compared to $23k price or whatever is a bit extreme yeah.

Ultegra134

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I'm sorry, wasn't your cousin informed about the fees and the exchange rate beforehand? Why would he proceed with such a high purchase price? I'm not sure about other countries, but ATM fees are also excessive here, but this is outrageous, daylight robbery. If the exchange rate is so bad, what's the point of using an ATM? I'd rather pay taxes than lose so much money for absolutely no reason. This is the main reason people are reluctant to give up on exchanges: almost every other option isn't as convenient and usually costs more than it should.

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Quote from: OgNasty on March 03, 2023, 06:14:48 PM

From a quick glance and with limited knowledge of how Bitcoin ATMs work from the setup perspective, I assume that the person who owns the ATM set a pretty high fee and that fee is baked into the price for the end user. Maybe this is done for simplicity or to hide the fees from the user so it seems like a fee-free experience, but regardless of what is to blame that receipt could give more information. I can understand things on the screen trying to be as simple as possible and not have the user doing math to calculate fees, but to not show anything at all seems almost misleading. Especially if it's built into the price and nothing else is shown.

It is built into the price and from what I also know nothing else is shown. Maybe some extra fee as "transaction fee" in some cases.
However, the ATM shows both buy and sell prices and you can easily see how big is the spread, hence the fee they're trying to get from you. Not the most straightforward way, nor the most exact, still it can work/can help.

Quote from: Nwada001 on March 02, 2023, 08:51:40 PM

The same thing happened with 1,800 dollars' worth of bitcoin, and only 1377 dollars' worth of bitcoin was received at the address.

Wow. I've seen ~14% fees and I've found them very big (normal would be somewhere closer to 6%). But in your case, if my math is right, it's 23.5%. That's indeed excessive.

romero121

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This incident serves to be an eye opener, because most of the time users never look for the fees. Then onwards it is must to have watch the fee prior to withdrawal/deposit. Our earnings going into someone's pocket without reason needs to be stopped. Very limited regions have got Bitcoin ATMs and these act of increased fee will surely generate negativity among the cryptocurrency users who have been using cryptocurrency for different purposes (shopping, buying services,etc). Concern person who had set the ATM should be contacted by the ATM provider an necessary steps need to be taken at the earliest.

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From a quick glance and with limited knowledge of how Bitcoin ATMs work from the setup perspective, I assume that the person who owns the ATM set a pretty high fee and that fee is baked into the price for the end user. Maybe this is done for simplicity or to hide the fees from the user so it seems like a fee-free experience, but regardless of what is to blame that receipt could give more information. I can understand things on the screen trying to be as simple as possible and not have the user doing math to calculate fees, but to not show anything at all seems almost misleading. Especially if it's built into the price and nothing else is shown.

Topic: Bitcoin ATM Deposit Exchange Rate shocks (Read 429 times)