Cryptocurrency ATM Market: Medium of exchange that utilizes cryptography for secure transactions and control additional currency unit creation
Cryptocurrency ATMs are the easiest means to buy cryptocurrencies, which also support selling of the digital currencies. Owing to their capability to support multiple forms of cryptocurrencies and ability to support any national currencies across the globe, these machines have gained significant traction over the past few years. Prominent growth factor fueling demand is the proliferation of these digital assets or currencies, across the globe and growing acceptance of these decentralized means of transactions
High demand for digital currencies is expected to drive the cryptocurrency market growth
Cryptocurrencies are driven by several advantages over the conventional currencies such as the limited supply, growing number of investors, growing user confidence, growing mining complexity, and substantial support by the media. In October 2013, Robocoin machine was introduced as the world’s first publicly available bitcoin machine to improve the transaction ability. The machine witnessed 348 transactions, in its first eight days of installation with an average transaction value of USD 273. In its first installation, the (ROI) reported was less than a month.
Rising ROI Along With the Capability of the Two-Way Transactions are Expected to Fuel the Overall Industry Growth during the Forecast Period
Rapid increase in the number of ATMs every year has forced the ROI to set back, however, it is largely dependent on the location of deployment of the Bitcoin Automated Teller Machines (BTMs). According to Coherent Market Insights, on an average the most populated or urban areas have the highest number of transactions, that help in generating complete ROI within spans of less than a year, even if the number of visitors per day is around 1-2. According to Coherent Market Insights analysis, the average number of new installations are expected to increase past 14 per day by 2025 driving the volume growth at over 44.6% CAGR over the forecast period. Moreover, according to Coin ATM Radar, the total number of deployments reached to around 1730, as of October 27, 2017, due to high ROI and increasing popularity of the digital currencies. Also, Coin ATM Radar estimated 4.43 Bitcoin ATMs installations per day in the last seven days in October 2017.
The global cryptocurrency ATM market is estimated to be valued at US$ 13.99 million in 2017 and is expected to witness a CAGR at 45.8% during the forecast period (2017 – 2025).
Figure 1. Global Cryptocurrency ATM Market, North America Trends
Substantial increase in costs legal costs are expected to be the major hindrance in the cryptocurrency ATM market growth
Compliance to the existing distinct regulatory requirements from county to country, these are among the most underestimated expenses which also contribute to significant difficulty for the users in deployment. Basic level of registration and compliance requirements require an upfront amount of US$ 5,000 and the same amount annually to maintain the operations. For businesses running multiple machines, the cost include an upfront compliance requirements of over US$ 15,000 with around to US$ 10k to maintain the operations. Additional costs also include hiring a dedicated compliance officer, whose salary can be estimated in the range of US$ 50k to 100k annually. Moreover, there are bigger companies which have reported higher expenses for these compliances and maintenance of operations. Moreover, acceptance of the technology and regional government is expected to be among the prominent other factors that will continue to hinder the industry growth through the forecast period.
North America dominated the global cryptocurrency ATM market share by volume in 2016 accounting for 73.21% of the global industry in 2016
Due to high concentration of deployments in U.S. and North America, North America has remained the most dominating region in terms of both value and volume over the last few years, is expected to dominate the industry share through the forecast period. North America was followed by Europe, Asia Pacific, Latin America and Africa.
Top industry participants in the cryptocurrency ATM market in order of their volume share are Genesis Coin, General Bytes, Lamassu, Bit Access, Covault, BitXatm, BTC facil, Skyhook, and LocalBitcoins.
Cryptocurrency ATM market refers to the business through the deployment of internet machine that enables exchange of digital currencies and conventional currencies. In some cases, these transactions require users to have existing accounts with the operator. Moreover, some of these machines are featured to support multiple exchanges and wallets, and can be programmed to support any national currency of multiple denominations. Substantial increase in the popularity of these digital assets is among the chief industry growth drivers, and witness CAGR of 45.8% over the forecast period (2017–2025).
Growth of over 200% Digital currency market capital witnessed from March 2015 to March 2016, according to CoinMarketCap. Moreover, according to Coherent Market analysis, the valuation is expected to witness growth of over 600% in 2017 with respect to the previous year. Requirement to provide easy transaction means and the associated profit will present substantial growth potential over the forecast period. Furthermore, ease of deployment at any outlet, ease of accountability, secured transaction ability (owing to utilization of blockchain technology) and anonymity are among its major advantages. However, high initial deployment costs and regulations are among the chief drawbacks that will continue to hamper the industry growth through the forecast period. For instance, China, Russia, Bangladesh are among the few countries that have witnessed bans and introduction of stringent regulations to restrict the utilization of these digital assets.
This report segments the global cryptocurrency ATM market on the basis of revenue source and cryptocurrency type. On the basis of the revenue source the industry is bifurcated into new installation and revenue through other sources. New installation is further segmented into one-way and two-way ATM based on the transaction types. For in depth analysis revenue through other sources is further categorized into transaction commissions, server utilization, technical support & other services (software upgradation, software installation, extra developments/software customization, layout customization). Based on the cryptocurrency type, the cryptocurrency ATM market is classified into Bitcoin, Litecoin, Dash, Ether, Dogecoin and other cryptocurrencies.
Key features of the study:
“*” marked represents similar segmentation in other categories in the respective section.
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