In the following interviews, Charlie Shrem is talking with Lennart Lopin, a representative of Byte Federal, about Bitcoin ATMs.
At the beginning the guys are talking about the early Bitcoin, mentioning how in the past there was no real way to buy Bitcoin. Interestingly they say that we can look at it as a bridge connecting one piece of land with another, old piece of land. Where the old piece of land is the traditional banking system, and the new land is Bitcoin. That way we were having to rent other bridges and pay a very high toll in order to get into cryptocurrency.
Further on, they are talking about how nowadays it’s normal to go anywhere in the USA and find Bitcoin ATMs, and rely on them. As opposed to the beginnings in 2014, when the market wasn’t ready yet.
On the other hand, when talking about Europe, they are mentioning how Bitcoin ATM network is a kind of a mirror of the financial freedom of the country. For example you can find a Bitcoin ATM in every street corner and you travel to Paris which is just two hours away, and there are none.
They also compare the Banking service in the USA and Europe, wherein the USA you have more tellers than ATMs on the site, while on the other hand, in Germany for example, it’s almost impossible to find a bank with a teller. All banks are more focused on self-service and have machines where you can make deposits and withdrawals. They agreed that this could be the reason why the adoption rate is different in the United States vs Europe.
Later on they compare the Bank ATM vs Bitcoin ATM and agreed that the latter has much more to offer. For example on Bitcoin ATM you can get asset back loan in five minutes while doing it the traditional way it would require going to the bank and waiting for weeks to get the approval.
Lennart is saying that if you aren’t controlling your software and rely on a third-party middleman you lose the flexibility. If there are any changes, either by law or by the user, you will have to wait in order to implement them. While writing your own software. Byte Federal is writing its own software and using the machines in-house so they are ready to answer to any user requests on-the-fly.
He later talks about how they got the registration process down to as fast as possible. They kept all of the regulatory steps but simplified it so a 90-year-old can use it and not get discouraged.
At the end he explains how they were not awaiting for regulators to come to them, but decided to make the initial contact with every state. Interestingly they noticed that the government is pretty exciting and opened to new technology when you bring the new technology to them and explain how it works.
In the second part Lennart is talking about various scams they encountered.
Firstly, he talks about a scam where a person gets a call allegedly from SSA claiming that their identity is stolen, and some money laundering is committed in their name so they need to go and get a new social security number. To do that they need to call the local police station and hand the phone to the scammer. Minutes later they will receive a phone call that will display as the police station but is the scammer actually, and he will request that they go and pay a certain fine in order to get a new social security number.
In order to help to prevent these kinds of scams, Byte Federal is trying to slow the users down, make them sit on the screen for 30 seconds before they can do anything while displaying different messages.
After, Charlie talks about a scam they encountered back in 2012 with BitInstant.
So, when you go to Bitinstant, select the amount of Bitcoin you want to buy and type in your zip code you will get an information about the nearest location where you can buy Bitcoin from. Than it would create a slip that you can print or keep in your phone. After you need to go that location where they will scan the barcode, you give them the money, and get the Bitcoin.
Having that in mind there was a website that was offering to sell rare exotic pets, and the user will go to this website asking to buy a pet, and getting a slip in return. Then, they will go to the store to scan the slip and give the money, but the Bitcoin will go to the owner of the slip and not to the user. So in Bitinstant, they received a lot of complaints from users requesting their pets.
To try and prevent this in Bitinstant they added a Bitcoin address on the slip, asking the person holding it to confirm that this address is actually theirs. After that failed to help, they had to print the notice “If you are using this slip to buy a pet, it’s a scam!”. Basically, it was up to them to educate the users not to fall for these scams.
To summarize, Bitcoin ATMs are offering more features than regular Bank ATMs. If you want to be a manufacturer it’s better to write your own software instead of relying on a third-party middleman. For the best customer experience, focus on educating and preventing your users from participating in numerous scams out there.