- December 16, 2021
Did you know that there are currently approximately 19 million Bitcoins circulating throughout the world?
This may not sound like a lot, but a single Bitcoin is worth $48,000 USD as of this publication. Since the blockchain is constantly expanding and only 13% of Americans actively trade Bitcoin, there’s more than enough to go around.
Bitcoin ATMs are a safe, secure, and convenient way to trade cash for crypto. They also are an equally fantastic way to convert crypto back to cash. However, it’s essential to understand a Bitcoin ATM buy limit before using them.
Read on to learn more about how Bitcoin ATMs work and buy limits.
How Do Bitcoin ATMs Work?
Bitcoin ATMs are kiosks where you can exchange fiat currency for Bitcoin. In turn, you can also trade Bitcoin for government-issued currency at these machines. They go both ways for your convenience.
Bitcoin ATMs are similar to regular ATMs in appearance and function. You can find them at your local grocery or department store. Many gas stations also have a kiosk, so look for the one nearest you.
In the past, people have generally gotten Bitcoins by purchasing them online. This practice is still common, but it’s hugely inconvenient because you need to wait up to a week for your crypto deposit. It also is unsafe because some Bitcoin exchange websites are convincing scams.
People also can access Bitcoin by mining for it. They document and block off transactions in the blockchain in exchange for a small reward. However, since you don’t get much in return, this is much investment for minimal gain.
Bitcoin ATMs aim to solve these problems and offer even more benefits.
They’re low-investment since if you can get to a machine, you can use it for free. This is unlike the enormous investment required for Bitcoin mining. Mining requires high-processing computers worth hundreds (or thousands) of dollars and considerable time investment.
Machines are also convenient because you receive the Bitcoin you purchased in fewer than five minutes. They also have security features such as buy limits and multi-factor authentication.
Is There a Bitcoin ATM Buy Limit?
As you may expect, there is usually a limit to how much cryptocurrency you can purchase in one day at a Bitcoin ATM. Luckily, the buy limit doesn’t mean that you need to stop using the ATM forever. It just means that you can’t go past a certain amount in a single transaction or day.
Every operator gets to choose the maximum amount that buyers can purchase from machines on their own. As a result, you will need to check the amount of Bitcoin you can buy at the specific machine you’re using.
Many ATM providers only allow you to purchase $3000-$9000 of Bitcoin per day. However, this can be inconvenient for some individuals who want to make large Bitcoin purchases online or in stores. It also is problematic for professional gamblers, and online casinos are one of the most effective uses for Bitcoin.
All Bitcoin operators are required to register with the Financial Crimes Enforcement Network (FinCEN). They also need to comply with all anti-money-laundering stipulations outlined in the Bank Security Act (BSA).
ByteFederal offers a much higher daily limit than other providers. For example, you can convert $21,000 worth of cash to Bitcoin in a single day.
Note that limits exist across all machines, so you can’t take $42,000 out by going to two machines. So it’s $21,000 across the board.
Many machines also have limits on how much you can buy in a single transaction. When you first register, this limit will be $300.
There are many security measures in place to keep both your cash and your eWallet safe during large transactions. Our kiosks don’t save any of your information. So even in the unlikely event that someone were to hack into them by passing up our multi-factor authentication system, there would be no information to steal.
If you reach out to us, we also are happy to provide you with proof that we’re authorized by FinCEN and comply with all legal requirements. So you can rest easy when you use our machines.
Upper and Lower Limits
Bitcoin ATMs generally have a lower limit as well as an upper one. $21,000 is the most that you can exchange. However, the least you can exchange is generally anywhere between $5 and $15.
This is important because it allows the machine to continue functioning correctly. Small $1 transactions take up much time, but that isn’t all. The machine doesn’t hold onto small bills, so you won’t be able to insert or receive $1.
Minimum withdrawals and deposits also are essential for security. Many cybercriminals test stolen financial information with small withdrawals and deposits. A minimum limit stops them from doing this and keeps your account information safe.
Why Do Buy Limits Exist?
At this point, you likely are wondering about the necessity of buy limits. To Bitcoin newbies, they may sound like an unnecessary inconvenience. However, there are multiple core reasons that limitations are essential.
First and foremost, they are a security measure designed to keep you and other Bitcoin users safe. Like ATMs that work with fiat currency, there are risks such as people stealing your debit card information. They can then wipe your account clean at a machine and leave you with nothing if there are no limits.
There is a lower risk of this problem with Bitcoin ATMs since a QR code is also necessary to exchange. Since people need an ID in addition to all other verification, it’s unlikely that this will take place. However, it still is possible, and buy limits protect your account if this does happen.
Limits stagger the amount of Bitcoin that can be purchased at a single time. If someone gains access to the information needed to take out Bitcoin, they can’t wipe your entire account dry. They also can’t steal your cryptocurrency since limits exist when converting crypto to cash.
Practicality and Limits
The fact that Bitcoin ATMs let you exchange crypto for cash (in addition to the other way around) means that limits are required.
If you can withdraw as much money as you want, you could drain the ATM. Unfortunately, people who came later couldn’t withdraw cash. Limits let the machines work for more people.
On the flip side, all machines can only store a maximum amount of cash. If you put too much money in and convert it to crypto, you might fill the device so that others can’t deposit cash. The ATM can remain open all day.
Limits mean that you need to use the ATM multiple times if you want a vast amount of crypto. This is because you need to identify yourself repeatedly for each transaction.
While this may sound inconvenient, it keeps you safe. You will constantly have an authentication procedure done before much cash is withdrawn (or a lot of Bitcoin is deposited into an eWallet). This deters thieves from stealing large quantities of money.
Compliance With Regulations
We briefly brushed on how crypto ATMs must comply with the anti-money-laundering stipulations of the BSA. These regulations require there to be a limit in most situations. ATMs across different providers will have different buy limits, but the limit will almost always exist.
But does every Bitcoin ATM have a buy limit?
No. Some Bitcoin ATMs have no buy limits, but these machines are generally not compliant with federal law. So you aren’t safe using them.
Even if a non-compliant machine isn’t used for illegal activity, you will have fewer protections in place in the event of an issue. Non-compliance with limits also shows that the ATM operator doesn’t care to ensure the safety and security of their customers. You will likely be thrown under the bus if anything happens.
It’s best to stick with ByteFederal’s reputable and reliable machines when exchanging cash for crypto (and vice versa).
Using a Bitcoin ATM
Understanding buy limits is a critical step towards using a Bitcoin ATM. However, to get any money out of the machine, it’s vital that you know how to use it.
The first thing that you’ll need to bring is a government-issued ID. This can be something as simple as a driver’s license. You’ll scan this to prove your identity before you can work with fiat currency or Bitcoin.
You also need to bring the cash you want to exchange (assuming that you’re purchasing cryptocurrency). Without it, you won’t be able to make a purchase.
The final thing that you’ll need is a QR code for your eWallet. If you don’t have an eWallet or simply want to upgrade to a more accessible one, you can set up a ByteWallet.
ByteWallet lets you log into our machines quickly with just a smartphone and ID. You won’t need to enter any other credentials. You can both access and trade in Bitcoin with this QR code.
Additionally, ByteWallet lets you send and receive Bitcoins to other users. It operates under a peer-to-peer infrastructure. You can access a Bitcoin highway called the Lightning Network to transfer Bitcoin instantly between accounts for free.
Bitcoin ATM Machine Logistics
Now that you know what to bring to a ByteFederal ATM, it’s time to take a look at how it operates.
Scan your ID at the kiosk to log in. The image will be immediately deleted for your security once it’s authenticated. So you don’t need to worry about the ATM storing your information and if a breach occurs.
Once your identity is confirmed, scan the QR code of the eWallet that you’re using. If you have ByteWallet, you can access all of the other capabilities here as well.
Select the type of transaction you would like to make. For example, if you want to exchange Bitcoin for cash, tell the machine how much fiat currency you want. The corresponding amount of Bitcoin will be removed from your eWallet. The cash will be immediately dispensed.
If you want to buy Bitcoin, insert the cash into the appropriate slot. You will receive the corresponding amount of Bitcoin. Make sure that you do the math correctly if you want a certain quantity of Bitcoin!
Wait for the Bitcoin withdrawal or deposit to show up in your account. This will take no more than five minutes at the very most. You can then log out of the machine and rest assured that your information has been deleted.
Limits and Exchanges
If you want to exchange cash for $21,000 worth of Bitcoin in one day, it’s well within your right to do so. However, we recommend breaking this up into smaller transactions for your safety.
It’s easier for things to go wrong during one enormous transaction. In the unlikely event that that particular transaction is compromised, you will lose all of your money. However, if you break it up into 21 $1000 transactions, a single transaction’s being compromised won’t lead to more than $1000 in damages.
In the end, this is entirely your choice. However, a greater quantity of smaller transactions is generally the way to go.
Invest in Bitcoin Today
While there are many ways to access cryptocurrency, Bitcoin ATMs are one of the best. They’re convenient and secure. In addition, a Bitcoin ATM buy limit keeps your accounts safe so that you don’t need to worry about a devastating breach.
Now that you know all about these limits and why they exist, it’s time to begin accessing crypto.
We’re committed to helping you access and use the cryptocurrency securely and efficiently, so we’re excited to get in touch. Contact us with any remaining questions that you have!