Bitcoin Depot ATM

Paul Zahner from Elev8 at Crypto Shit Show about operating bitcoin ATMs

In this video, from the Crypto Shit Show held in Philadelphia on May 23, 2018, Paul Zahner from Elev8 ATM services is speaking about his company and their services in the cryptocurrency ATM business.

Elev8 is a United States based operator that has 7 bitcoin machines installed in Pennsylvania, Delaware and Costa Rica.

Quick History

Paul first heard of Bitcoin back in 2012 and really did not pay much attention to it, like most people and over the years he thought it was cool technology, but never really sunk in until  2 years ago. In 2016 the Bitcoin got really crazy so he started to go down to the Bitcoin rabbit hole. As he became more and more passionate about the technology he really wanted to do something different. With a help of his friend he bought his first 3 machines and started his business. He also states that in order to go into the Crypto ATM business you need to be passionate about the technology and to understand how the money works.

Business Overview

Zahner is emphasizing that Elev8 had their first 3 machines set up in October and now, in less than a year they doubled that number. Recently they started working at the institutional level with transactions up to more than $100.000, so they are really expanding. As far as the machines go they are always looking for attractive locations. Attractive locations being 24/7, with good traffic, like gas stations etc. If you are aware of any potentially good spot feel free to contact Elev8,  they are always looking for a partner and are willing to pay a finders fee.

How does ATM work

It is cash only. If you are going under a 1000 dollars it will ask just for your phone number and it will send you an SMS text message, you punch in the code sent to you, scan your wallet, put in your cash and you are done.  If you are going over a 1000 dollars you will need to scan your driver’s license. That is in order to prevent a number of elaborate scams out there.

Q&A Section

  •  What is the process of listing a new coin?

Right now we have Bitcoin and Litecoin on machines. We do plan to add Ethereum but basically, it depends on the manufacturer and the supported wallet.

  • Does the ATM do deposits?

Most of the machines are going to be buy-only where you can only buy cryptocurrency. We currently have two buy/sell machines. One is on 69th street and the other one is in Costa Rica. Buy/sell machines are fewer and far between. They are also significantly bigger.

  •  Is that because there is a bigger cost for buy/sell machines hardware itself?

Yeah, one is the bigger costs and second reason is that majority (~90%) of the transactions are going to be buy-only.

  •  What does it look like for a shop owner?

It is all different depending on the shop owner. Some are getting the free marketing like advertising on our facebook page or coinatmradar.com while others get a percentage of the transactions.

  • How much is your fee?

Currently, machines are taking 10%, which is kind of a norm. If the market changes and it goes down, we will go down too. We try to stay within the market average.

  • What is the average number of transactions that you are getting per day on these machines?

The average number of transactions really depends on the market. When the prices go down people start buying and vice versa.

  • If the price of Bitcoin is low why not charging a low fee, do you think it would inspire people?

Yes, that is definitely something to think about. Most recently it has gotten better. Sometimes we are losing money on transactions, and when the prices are low we are earning, so it all evens out at the end. I am honest, we are not the cheapest way to trade crypto, but we are definitely the most convenient.

  • Have you done anything in terms of advertising?

Not as much as I would like, and that is definitely something we need to do.

  • Back in the day, there were examples of competition vandalizing each other machines, is that still going on?

We haven’t ever experienced something like this. We try to make sure that doesn’t happen when we pick a location. I think that this was the case in the beginning when a competition was very territorial, but now when there are so many I think these things do not happen anymore.

In the end, if you are passionate about technology, go and do something, don’t just sit back and rely on people to do it for you.

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