Crypto ATMs will revive after Bitcoin ‘FOMO’ hits full swing, says CEO
Bitcoin ATMs may see a global acceleration in installations after the Bitcoin halving, when crypto FOMO (fear of missing out) typically hits a fever pitch, according to the boss of a major Bitcoin ATM operator.
In the year In 2023, crypto ATM shipments showed their first annual decline in a decade, exacerbated by the collapse of several crypto companies due to the bear market.
However, Bitcoin Depot CEO Brandon Mintz said in 2016 that Kicking off with a bang in 2024, 1,469 crypto ATMs were installed in the first three months, compared to more than 3,000 removed during the same period in 2023, according to data from CoinATMRadar.
“It looks really positive that the industry continues to see a lot of growth in kiosk counts,” Bitcoin Depot CEO Brandon Mintz told Cointelegraph.
Mintz is now bringing the industry-wide ATM back into the swing with Bitcoin (BTC), which previously hit an all-time high twice in March.
In past bull markets, Mintz said that “later in the cycle, especially when that FOMO period starts to happen,” crypto adoption increases and brings in more customers.
“The adoption rate is very important because if more people buy bitcoins, a portion of those will go to Bitcoin ATMs.”
But that typically comes later in the cycle and “it's still very early,” Mintz said.
“We're not at the halving yet,” he said, referring to a planned event at the end of April when Bitcoin mining rewards will drop by 50%.
“A lot of the ups and downs we've seen in the past were after halving,” he added. “After the halving, that's when the price really speaks, and that's when the FOMO phase kicks in.”
While the ATM count has increased recently, Mintz said the number of ATM operators has decreased over the past 18 months. One of the biggest is 5,000 ATM strong operator Coin Cloud, which went bankrupt in February 2023.
“A lot of them are struggling and going out of business more than it appears to the public,” he said.
In the year After crypto exchange FTX crashed in November 2022 and took over the crypto market, he added, the decline “happened quickly.”
Bitcoin Depot's fourth-quarter and full-year 2023 results released on March 25 showed revenue rose 7% year over year to $689 million, although net income fell 54% to $1.6 million.
It has purchased 900 ATMs for installation in the first quarter of 2024 and plans to have 940 ATMs live in convenience stores in 24 US states.
A Bitcoin ATM operator like CoinATMRadar shares the market with other smaller operators. Second rival operator Coinflip has more than half of that with over 4,200, while Bitstop is third with over 2,500.
Spot Bitcoin ETFs don't care.
Of the 37,001 crypto ATMs in the world, the United States is home to nearly 83%, more than 30,600, according to CoinATMRadar.
In January, the U.S. also approved a spot in Bitcoin exchange-traded funds (ETFs) that some have hailed as an early adopter for institutions and retail brokers looking to get into bitcoin.
Mintz is unfazed by the potential impact of ETFs on Bitcoin ATMs. “We see it as a completely different customer base,” he said.
Related: Bitcoin ATM flaw could have given hackers ‘total control'
He added: “A large proportion of our customers transact with cash or cash only because they are underbanked or unbanked.
On the other hand, buyers of Bitcoin ETFs are “high net worth individuals with brokers and brokerages.”
“[The] Most of our clients make less than $90,000 to $100,000 a year, so our clients don't have a brokerage account or a broker and are not sitting on the sidelines waiting. [an ETF] It's so easy to just buy at a Bitcoin ATM,” said Mintz.
Instead, he thinks that ETFs that boost Bitcoin's value could mean more ATM usage as Bitcoin adoption takes off.
“If adoption increases, we think it could translate to an increase in Bitcoin ATMs. So in the grand scheme of things, I think it's more beneficial to us than negatively impacting us in our industry.”
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