​​What is a Bitcoin ATM and How Does it Work?

  • By Localcoin
  • October 8, 2023
what is a bitcoin atm

With the rise in Bitcoin's popularity and the fact that many see cryptocurrencies becoming far more relevant as time goes on, many aspiring crypto-enthusiasts are looking for safe, secure ways to buy and sell this novel form of currency.

But how does one go about doing that? While it can seem daunting and confusing for newcomers, one of the easiest ways to buy and sell cryptocurrencies is with a Bitcoin ATM.

According to CNBC, there are 2600+ Bitcoin ATMs (Automated Teller Machines) across Canada. So, in this guide, you will learn ​what is a Bitcoin ATM, how it works, and how to use it to buy digital currencies.


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What is a Bitcoin ATM?

A Bitcoin ATM, also known as a (crypto ATM) allows individuals to buy or sell Bitcoin or other forms of cryptocurrency such as Bitcoin, Ethereum, Dogecoin, or Litecoin, using cash or crypto wallets.

It operates similarly to a traditional ATM but is designed specifically for cryptocurrencies. Bitcoin ATMs provide a convenient and accessible way for users to engage in cryptocurrency transactions without needing an online exchange or trading platform.

How Does Bitcoin ATM Work?

Bitcoin ATMs work by connecting to blockchain technology. When you use a Bitcoin ATM, the machine will give you cash in exchange for your Bitcoin or Bitcoin in exchange for your cash. The exchange rate of bitcoin will depend on the current market rate at the time of the transaction.

What are the Pros and Cons of Using a Bitcoin ATM?


Ease of Access: Bitcoin ATMs offer unparalleled convenience, allowing users to buy or sell Bitcoin easily in major metropolitan areas. Their strategic placements make them accessible for quick transactions without needing an online platform.

Strong Privacy: Bitcoin ATMs provide a level of privacy appreciated by users. Unlike online exchanges requiring extensive personal information, Bitcoin ATMs often operate with minimal identity verification, offering users a discreet way to engage with cryptocurrencies.

Accessible 24/7: The 24/7 availability of Bitcoin ATMs is a significant advantage, catering to users around the clock. This accessibility ensures that people can participate in cryptocurrency transactions conveniently, regardless of traditional banking hours.

Customer Support: Some Bitcoin ATM operators provide customer support services, assisting users who may encounter issues during transactions. This additional layer of support enhances the overall user experience.


High Transaction Fees: The Bitcoin ATM fees range from 5 to 15 percent, considerably higher than online cryptocurrency exchanges where fees are usually less than 1 percent. Some Bitcoin ATMs may also impose a variable miner fee to compensate those validating transactions on the blockchain. When considering a Bitcoin ATM, it's essential to research and opt for machines with the lowest fees.

Limited Cryptocurrency Choices: Bitcoin ATMs may lack the variety of cryptocurrency options available on online exchanges. Users seeking a diverse range of digital assets may find the selection limited, restricting their ability to explore alternative cryptocurrencies through these machines.

How to Use a Bitcoin ATM to Buy and Sell Cryptocurrencies


Now that we’ve covered some of the basics, let’s look at how transactions are done using Bitcoin ATMs. Every Crypto ATM machine is different but follows a similar process. Before heading to your Bitcoin ATM nearest to your location, ensure you have a compatible crypto wallet set up.

5 Steps to Buy Bitcoin Using a Bitcoin ATM:

  • Step 1: If the ATM offers buying services for more than one currency, select Bitcoin (BTC).
  • Step 2: Find the QR code associated with your Bitcoin address in your wallet. 
  • Step 3: Scan the QR code using the built-in camera. 
  • Step 4: Insert your bills when prompted. 
  • Step 5: Confirm the amount and complete your purchase. Transactions are usually instantaneous, but sometimes take between 10–30 minutes or even 1–2 hours. 

6 Steps to Sell Using a Bitcoin ATM:

  • Step 1: If the ATM offers selling services for more than one currency, select Bitcoin (BTC). 
  • Step 2: Select the amount of BTC you want to sell or the amount of cash you want to receive (this depends on the capabilities of the machine.) The machine is constantly updating its conversion rate every few minutes. 
  • Step 3: Confirm your selection and wait for a receipt that contains the QR code to send your Bitcoin. 
  • Step 4: From your mobile wallet, send Bitcoin to the address given on the QR code. 
  • Step 5: Bitcoin ATMs give multiple confirmation scores that indicate how hard it is to reverse the transaction. You will need to wait for a specified amount of confirmation before being able to withdraw your cash from the ATM. 
  • Step 6: Collect your cash from the ATM. 

Frequently Asked Questions (faqs)

Is it Secure to Use a Bitcoin ATM?

Using a Bitcoin ATM is a safe and reliable method of buying and selling cryptocurrency. However, this doesn’t mean that there aren’t security risks; it’s the customer’s responsibility to keep their private keys private as they are used to validate crypto transactions, allowing a potential hacker to move Bitcoins into their own wallet if accessed. 

Always use a reliable wallet app that you trust to manage your private keys. Additionally, users should always be aware of waiting for complete confirmation on the blockchain before considering a transaction complete.

Where to Find Bitcoin ATMs in Canada?

Bitcoin ATMs are widely distributed in Canada, offering convenient access for users to engage in cryptocurrency transactions. You can find these ATMs in major metropolitan cities such as Toronto, Kingston, Guelph, Sault Ste. Marie and Edmonton are among the highest-traffic locations.


By going through this guide, you will have a clear understanding of what is a Bitcoin ATM, how it works, and how to use it for your digital currency transactions.

Localcoin ATMs offer an accessible, user-friendly and secure way for anyone to buy and sell Bitcoin and other cryptocurrencies in their communities.

This is especially meaningful for beginners who are seeking a hassle-free way to dive into the world of digital currency with confidence! Newcomers and experts alike can easily access Localcoin ATMs when and where they need to.

As Canada’s largest Bitcoin ATM network, with more than 900+ terminals, it’s never been more convenient to buy and sell cryptocurrency.


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