Entering the world of cryptocurrency is now as easy as using an ATM.
Specialty bank machines have appeared at the first two locations in Sarnia — Russell’s Corner variety store and Lambton Mall — allowing residents with cash to buy Bitcoin, Ether and LiteCoin, the big three digital currencies.
Cryptocurrencies are digital money that’s almost impossible to trace. Their value is determined by global markets through supply and demand.
A representative at Russell’s Corner variety said the new terminal is making it easy for customers to transfer money around the world anonymously.
The terminal belongs to HODL Digital Services, a Toronto-based firm with about 25 Bitcoin ATMs operating in Ontario. HODL co-owner Sam Mokbel said most are set up in convenience stores and gas stations.
He said storeowners typically receive $200 to $400 per month, depending on location and foot traffic, while his company earns a 6% to 10% commission on each cryptocurrency purchase.
Buying Bitcoin is not unlike converting Canadian to U.S. dollars. But instead of bank notes coming out the slot, the purchased cryptocurrency is sent via the Internet to the customer’s digital wallet. It can also be printed out as a QR code on a receipt.
A digital wallet is like a bank account and contains public and private cryptographic keys — basically two seemingly random combinations of letters and numbers.
The public key allows other wallets to make payments to the wallet’s address, while the private key enables the cryptocurrency to be spent from that address.
People use their private key to send money, and the transaction has no personal name attached to it – just the key. That makes cryptocurrencies appealing to anyone wanting to conceal money transfers.
Most cryptocurrency ATMs accept only cash, Mokbel said. But customers who bring their wallet key to the machine can withdraw cash from it.
Bitcoin and others like it are de-centrally stored and maintained in a publicly available ledger called the blockchain. Purchases and sales are noted in a constantly updating ledger.
At press time, one Bitcoin was worth $9,726. Shortly after it was created in 2010 one Bitcoin cost 9 cents.
It’s estimated more than 1,600 different cryptocurrencies are already in existence. Facebook is developing one called Libra that’s expected to launch next year.