As a crypto investor with a background in economics, I’ve witnessed firsthand how inflation and distrust in traditional financial institutions have driven people towards alternative forms of value transfer. The potential of cryptocurrencies like bitcoin to offer faster, cheaper, and more accessible transactions has been a game-changer for many individuals and businesses.
As a financial analyst, I’ve noticed an intriguing trend in the market: an increasing number of consumers are turning to bitcoin ATMs as a viable alternative to traditional financial institutions during times of inflation and trust issues. Initially, these kiosks were viewed as mere novelties, but they have now become commonplace at U.S. grocery stores and other easily accessible neighborhood locations. For those with limited or no understanding of blockchain technology and its potential benefits – such as sidestepping inefficiencies in traditional banking and payment systems – these bitcoin ATMs could serve as an introduction to the crypto world.
Leading U.S. crypto-exchange Coinme, based in Seattle, is spearheading the implementation of bitcoin ATMs nationwide. Founded in 2014, this pioneering company has grown significantly, reaching over 40,000 locations across the United States. Consumer demand, driven by the vision of co-founder and CEO Neil Bergquist, positions bitcoin as a more appealing alternative to traditional banking services.
“According to Bergquist, the value of money held in inflationary assets such as fiat currency decreases over time. The banking system fails to offer an alternative with greater value retention.”
Over the past three years, the buying power of the U.S. dollar has significantly decreased due to high inflation rates. In response, investors have turned to bitcoin as an alternative. With a maximum supply of 21 million coins, bitcoin’s scarcity and decentralized nature make it an attractive option for those looking for protection against inflation. According to Bergquist, this core advantage sets bitcoin apart from traditional assets, which can be influenced by inflationary pressures caused by central banks or government policies.
Combating a ‘Wild West’ Perception
The ability of Bitcoin to serve as a shield against inflation is only one reason why people are drawn to Coinme’s platform and the larger crypto market. For numerous individuals, cryptocurrencies provide a means of financial independence, free from the control of large banking institutions.
“Bergquist explains that some of our customers prefer using cash as it represents autonomy to them. They’re wary of banks monitoring their accounts and value the independence this method provides. Similarly, these individuals are drawn to bitcoin due to its association with self-custodied ownership and liberty. However, crypto’s past image as a lawless digital realm has hindered wider acceptance among the general public.”
Despite some negative perceptions, Coinme is actively working to align with stringent compliance regulations akin to those in conventional finance. Simultaneously, they aim to preserve the key advantage of blockchain – decentralized, unalterable transaction verification.
“According to Bergquist, Coinme is a financially authorized and supervised organization, similar to other trusted financial entities. We’ve established know-your-customer (KYC) and anti-money laundering (AML) measures, including blockchain surveillance. If you attempt to transfer crypto to a high-risk wallet, our platform will decline the transaction. When regulated crypto exchanges and wallets adhere to these regulations, they enhance the security of cryptocurrencies and make them more acceptable to the general public and traditional financial institutions.”
Through meticulous adherence to regulatory standards, Coinme has gained the confidence of prominent retail partners such as Coinstar, MoneyGram, and major grocery store chains. Notably, this compliance has made it possible for the company to bring cryptocurrency within reach of the general public.
“According to Bergquist, we’ve addressed the issue of access. In fact, there are more Coinme cash points than all the ATMs or branches of the biggest private banks in the US. This means that you have more options to purchase crypto using cash than you do to deposit cash into the largest private bank ATMs.”
Democratizing Cross-Border Payments
As a crypto investor, I can’t help but be in awe of bitcoin’s underlying blockchain technology that makes transactions swift and borderless. The cost savings are a fraction of what traditional money transfer methods demand. This game-changing aspect has sparked immense grassroots adoption among a group of people who have long been underserved: those dealing with the intricacies of cross-border remittances.
As a researcher studying user behavior, I’ve encountered individuals who lead multinational lives, with friends and family residing outside of the United States. These users find themselves frequently utilizing our platform to transfer cryptocurrencies like Bitcoin across borders. The reason being, cross-border crypto transactions can typically be carried out more swiftly and cost-effectively than traditional fiat currency transfers.
Conventional methods for sending money, such as bank transfers, can come with hefty fees reaching up to $35 per transaction, not to mention hidden exchange rate markups. These extra costs add an unnecessary burden to individuals supporting families in different countries. On the other hand, cryptocurrencies obtained from open and decentralized systems eliminate these inefficiencies, providing a more cost-effective solution.
“According to Bergquist, Bitcoin operates with interchangeability. You can transfer it through Coinme and retrieve it from Bitso or any other wallet or exchange, making the on-chain system a globally connected financial network. The open-ended essence of Bitcoin and blockchain sets it apart.”
In developing countries, the impact of these factors is especially significant. Fiat currencies can experience high inflation rates, causing the value of remittances to decrease dramatically before they even reach their intended beneficiaries.
Eliminating Hidden Fees
Bitcoin’s ability to facilitate effortless transactions between parties, regardless of geographical boundaries, has expanded its usage beyond remittances. It is increasingly being adopted for domestic payments and e-commerce due to the high fees charged by traditional financial intermediaries, which are undergoing reevaluation.
“Bergquist identifies another customer type, typically younger and well-versed in cryptocurrencies. They employ crypto not only as an investment but also as a means of payment. Merchants who provide incentives for Bitcoin transactions are the preferred choice for this group, enabling them to bypass using Visa or MasterCard.”
As a financial analyst, I can tell you that the capability to circumvent the processing fees charged by credit card networks, which often reach up to 3% of each transaction’s worth for merchants, grants businesses with significant cost savings. These savings can then be passed on directly to consumers in the form of discounts when they make payments using cryptocurrencies.
Bergquist points out an intriguing aspect of bitcoin: its capacity to disrupt the fees associated with checking accounts and payment services.
“Coinme doesn’t charge any account fees. You won’t find opening fees, minimum balances, overdraft charges, and so forth with us. In contrast, transferring funds from a US bank account to an international one typically costs around $30 or more. However, sending cryptocurrency directly to almost any wallet globally only incurs minimal fees.”
An Ecosystem Takes Shape
In the face of skepticism regarding the practical use of cryptocurrencies, Coinme has paved the way for its users to experience and enjoy the advantages firsthand.
As a researcher in the field of cryptocurrency, I’d put it this way: “I help individuals convert their bitcoin into cash on the spot, allowing them to purchase goods and services at over 20,000 ATMs scattered throughout the United States. One common misconception about crypto is that people question what they can actually do with it, as they believe it’s only good for speculation. However, by converting bitcoin into cash, you now have the flexibility to buy anything your heart desires.”
As the adoption of cryptocurrencies gains momentum and developers create more user-friendly interfaces on these technologies, a robust crypto ecosystem is emerging. This system is driven by the same fundamental principles that led to the inception of bitcoin – decentralization, immutability, and freedom from control by large intermediaries.
“According to Bergquist, Bitcoin represents a novel kind of digital currency that effectively addresses the issue of trust in our digitally advanced era,” or “Bergquist asserts that Bitcoin is a unique form of digital money that has successfully tackled the challenge of trust in today’s digital world.”
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2024-06-21 16:19