Buy Bitcoins at Bitcoin ATMs

Paul L – Cryptocurrency Entrepreneur – Bitcoin ATM Machines

In this video, MSCS media hosted Paul Leix. He is a partner in a Bitcoin ATM Operator called Digital Ventures Group. He talks about a lot of different crypto-related stuff, including the Bitcoin ATMs, the Operating business, compliance, predictions…etc.

Paul’s beginning was somehow interesting. He started trading Bitcoin back in 2013. after his then friend, and later partner persuaded him. For some time they traded at LocalBitcoins when they met an owner of Red Leaf Bitcoin ATM company and got an idea to go that path themselves. Have in mind that it was back in the day when Bitcoin ATMs were very rare. So, they went to the guy they know who owns a liquor store and installed a machine there on their own. The thing is that at the time they didn’t know how to get the compliance. The concept of crypto was new back then and they needed someone to do it for them. The first guy wrote a 2 pages long document and charged 900 bucks for it. Later on, they found the right guy who wrote them a complete book of policies and procedures which was the real deal. Of course, it also cost them a lot more, $15.000 to be specific.

After a while, Paul decided to leave the business because there were too many obstacles, they couldn’t get a bank, and all in all he didn’t saw too much potential. Long story short, his partner now has 600 machines and 50 employees and makes a ton of money. So, we could say that it was not a great business decision from this perspective.

Digital Ventures Group

After a couple of years working in other industries, Paul got approached by the owner of Digital Ventures Group because of his experience in the Bitcoin ATM business. He accepted the offer and his current role is to install and maintain the machines in all locations. Interestingly, they installed their first machine in the same liquor store where Paul and his first partner started their business back in the day. When it comes to the locations Paul is sure that the liquor stores and gas stations are the ones you should aim for.

Digital Ventures Group currently has 27 machines located in California, Florida, Illinois, Michigan, and Pennsylvania. Their short-term is plan to add 30 more this year with a long-term plan to reach a total of 200 machines. He claims that that is a good number of machines where you can earn serious cash, but you don’t get overwhelmed with the amount of work you need to do to maintain them. Only a few companies have more than a thousand machines and earn up to a million a month, but Paul says that’s simply too much stress. When it comes to scaling your Bitcoin ATM business, he explains that first you need to figure out the compliance and banking, and you’re good to go. After that it’s only up to arranging the locations and installing the machines.

The machines they use are Genesis Coin buy-only ATMs. Paul refers to them as the rolls-Royce of Bitcoin ATMs. He claims that even if there are machines that you can buy for $3.000 it’s better to spend $7.500 and get the best one around. You simply shouldn’t look to save money on the thing that’s making you money.

He then explained that these machines sell Bitcoin and Litecoin and are easy to use. You just need to scan the QR code of your digital wallet, or type it in manually, put the cash in the machine and you will receive the proper amount of crypto. The minimum transaction is $20 while the fees are between 13-20%.

When talking about the impact of Bitcoin price volatility on the Bitcoin ATM business, Paul says that there is not much difference, and the machines are doing well either way. People just don’t care, they continue to buy crypto regardless of the price because they look at it as a stock market and try to make money on that volatility. Another thing is that there are more and more places where you can go and buy stuff with Bitcoin. Having that in mind, Paul predicts that in the next five years there will be Bitcoin ATMs everywhere.

Compliance

Of course, Paul talks about compliance as the most important thing when operating a Bitcoin ATM Business. You need to have an LLC and then you have to register as a money service business. Then you need a compliance officer and an AML KYC policy.

He told a story about a company that was busted recently for running an illegal Bitcoin ATM business. There was no compliance or AML KYC policy. You could go and transfer Bitcoin without any means of identification which is considered a money laundering.

The Digital Ventures Group machines require you to scan the ID picture for transactions over $250. When you go over $3.000 you have to put in your social security number, and if you want to buy over $9.000 worth in crypto, you need to provide a proof of income.

They talk about compliance and regulations as something that is constantly improving, up to the point where one of the first questions on the tax returns form is “did you buy cryptocurrency?” Paul strongly backs up that trend, saying that Bitcoin will never go away and therefore it needs to be regulated properly.

Summary

After this interesting interview with Paul, we found out that there is a machine number limit that you shouldn’t cross if you are not prepared to handle a lot of compliance and logistics obstacles. It will bring you more money at a cost of much more stress. You should never look to save money on the machines. Buy the best ones at the market and aim to place them in liquor stores and gas stations. When it comes to compliance, don’t try to be clever and do everything you are required to do. If you don’t the long arm of the law will get to you eventually because Bitcoin is here to stay and it gets more and more regulated every year.

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