Crypto ATMs Continue to Thrive in the Wild West of Cryptocurrency
In a month where cryptocurrency has faced significant challenges, with high-profile legal cases and calls for regulation, one niche area of the crypto industry is thriving despite regulatory scrutiny. Crypto ATMs, which have been criticized for their potential to facilitate money laundering, are still a growing business.
While major figures in the crypto world face legal consequences, operators of crypto ATMs claim to provide an essential service for ordinary people looking to convert traditional fiat currency into cryptocurrencies and vice versa. These machines function similarly to traditional cash points at banks. One European operator, amusingly named the “Shitcoins Club,” states that they help people “bypass the banking system.”
Regulators in the United States and the United Kingdom have long been wary of crypto ATMs. The Financial Conduct Authority (FCA) in the UK, for example, recently intensified its crackdown on these machines, leading to the closure of several of them. Despite such actions, the number of crypto ATMs worldwide is still on the rise. As of October this year, there were 32,521 crypto ATMs globally, with numbers increasing since the summer, according to data from AltIndex.
Some crypto ATM operators embrace an anti-banking philosophy reminiscent of the early days of cryptocurrency when it was seen as a revolutionary alternative to traditional banking systems. For example, Luxembourg-based Bitgamo offers a virtual crypto ATM that allows users to convert tokens to cash online with minimal requirements for Know Your Customer (KYC) and Anti-Money Laundering (AML) checks. Moreover, it facilitates offshore transactions to maintain privacy and avoid regulatory scrutiny.
Gabriel Weber, director of communications at Bitgamo, openly acknowledges his company’s approach, stating that Luxembourg’s laws are more permissive compared to other countries. Bitgamo does not feel compelled to request KYC information from clients and does not investigate the source of funds unless compelled by a court order. They emphasize the importance of privacy, aligning with the original vision of Satoshi Nakamoto, the pseudonymous creator of Bitcoin.
Bitgamo’s ambitious plans include launching around 90 physical ATMs next year, and they report a thriving business with over 50 million daily transactions. Despite challenges faced by the broader cryptocurrency market, it seems that the crypto ATM industry continues to thrive, buoyed by a commitment to privacy and an anti-establishment ethos.