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Bitcoin ATM market concentration

Bitcoin ATM industry is relatively new, however, it develops very dynamically. There are many new players entering the market, at the same time there is definitely a trend of some major participants increasing their machine networks size. In this article we evaluate how high is the concentration in bitcoin ATM industry w.r.t. manufacturers and operators. For assessment we look at top 3 countries with highest number of bitcoin ATMs installed: United States of America, Canada and United Kingdom.

Concentration indexes

For the purpose of this article three types of indexes are used:

  • Concentration ratio 3 (CR3) – market share controlled by top 3 manufacturers or operators;
  • Concentration ratio 5 (CR5) – market share controlled by top 5 manufacturers or operators;
  • Herfindahl index – is a concentration index, which is calculated as a sum of squared market shares, and gives more weight to the situation with dominance of a single or small group of companies.

Bitcoin machine manufacturers concentration

At the moment there are plenty of bitcoin machine manufacturers. At the same time only few of them have popular products, which are mainly used by operators. Top 3 at the moment are:

Manufacturer name Market share
Genesis Coin 48%
Lamassu 18%
General Bytes 17%

These three Bitcoin ATM producers cover 83% of total number of installations.

The following two charts show how the shares of the top 3 and top 5 manufacturers changed in three above mentioned countries:

Top 3 bitcoin ATM manufacturers


Top 5 bitcoin ATM manufacturers

The first and main conclusion coming from these charts is that 80-95% of bitcoin machines on the these countries’ markets are controlled by 3 producers. Looking at most top 5 manufacturers brings the market share much higher to 95-100% range of values, e.g. in the UK the whole market (100%) was represented by no more than 5 bitcoin ATM manufacturers.

Another observation is although the share of top 3 and top 5 manufacturers stayed relatively the same in Canada and UK over 2015-2017 period, it has significantly increased in the U.S. for top 3 producers from 65% in the beginning of  2015 to current 91%.

A look at HHI index confirms the last observation and gives more insight about US market.

Bitcoin ATM manufacturers concentration

Canadian and UK market stayed relatively at the same level over this period of time, while Canada’s market is more decentralized (HHI is at 30% compared to 45% in UK). In the U.S. HHI increased from ~20% to current 55% level, which is a huge increase in market concentration (index value of more than 25% indicates very high concentration level). This is mostly can be attributed to increase in share of Genesis Coin machines, which has currently 73% share on the U.S. market and absolute dominance.

Bitcoin machine operators market concentration

Now we look at bitcoin ATM operators and their networks across those 3 countries.

Concentration ratios for top 3 and top 5 companies are the following:

Bitcoin ATM operators concentration

All three countries have  various concentration patterns. The expected result is that the countries with larger number of bitcoin ATMs also have larger diversification, namely lower concentration of operators. This assumption is confirmed via charts above. In the U.S. during year 2015 there was a trend for concentration reduction, e.g. CR5 index dropped from ~55% to 35%, however, it stabilized at this level during 2016 and concentration started growing a little in 2017 up to 40%. This could be explained by higher growth speed of large operators’ networks, rather than involvement of new bitcoin ATM operators. As an example, the largest US bitcoin ATM network is run by Coinsource, who currently controls 107 bitcoin machines (out of total 712, or 15% of the US market). In May 2016 they had 17 machines, while at 01 May of 2017 the number was 106 (6-fold increase during 1 year).

Top 5 bitcoin ATM operators in the U.S. w.r.t. number of machines installed:

Operator name Market share
Coinsource 15%
Bitcoin Depot 8%
Cottonwood Vending (CoinBTM) 7%
Athena Bitcoin 5%
RockitCoin 4%

Canada’s bitcoin ATM operators market concentration (CR5) stayed relatively stable at around 50-60% level, however, there is observed tendency also to concentration growth. The top 3 operators in Canada are:

Operator name Market share
Instacoin 22%
Bitnational 15%
ToBitcoin 14%

UK’s market is the most concentrated out of three with current top 5 operators market share at 78%. Top operators w.r.t. to number of bitcoin ATMs installed are:

Operator name Market share
SatoshiPoint 35%
Landmark Bitcoin 11%

Until the end of 2015 the ATM operators business concentration was increasing in UK (e.g. CR5 reached 90%), however, since 2016 the concentration ratio was falling, means the more and more operators were entering this new market.

HHI index for operators looks as follows:

Bitcoin ATM operators concentration

At this chart it is even more prominently seen the significant changes in UK market, as HHI grew from 15% to 35% and then was decreasing over time back to 15-20% level.  This means there was increased dominance of minor number of players, in this particular case it was a dominance of SatoshiPoint operator. Markets in the U.S. and Canada have values for HHI of 5% and 10%, which indicates relatively unconcentrated bitcoin machine operators market there.


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