The crypto ecosystem experienced a tremendous change with the announcement of the creation of Bitcoin ATMs. These Bitcoin ATMs function in a similar way to regular cash ATMs, only that they deal with crypto instead of fiat. These bitcoin ATMs can be used by a user to either withdraw or deposit cash holdings into their BTC Cash reserves. This innovation proved to be a huge win for the Bitcoin economy and the crypto ecosystem at large.
Crypto ATMs have slowly but steadily been gaining popularity in different parts of the world. The crypto ATM market has also recorded a boom since its inception. Some other cryptocurrencies, asides from Bitcoin have also been listed across some ATM terminals. For example, in mid-2021, U.S largest crypto giant, CoinFlip, reported that Aave crypto is now officially supported on its over 2,500 terminal network. This development is sure to lead to a spike in the use and widespread adoption of the Aave token, which will consequently increase the Aave crypto price.
The crypto ATM market development has led to the increased adoption of cryptocurrency in several locations around the world. According to reports, the highest number of bitcoin ATM installations was in 2021 with its peak in August (with over 2000) installations done. According to research by Cointelegraph, the sum of functioning Bitcoin ATM points in the world now stands at about 8,000. This is a massive increase of over 90% since the creation of the concept in 2019.
This proves the increased adoption of Bitcoin as a valid means of exchange. The use of these ATMs is done with the aim of making cryptocurrency, DeFi, and the advantages that come with it easily accessible to the general public.
ATM Installation Slowdown: What You Should Know
Bitcoin ATMs have no doubt greatly impacted the Bitcoin ecosystem as they serve a very important function. They allow a user to deposit cash in exchange for BTC, which is then transferred to their digital wallet. Transactions performed on a Bitcoin ATM are very safe and secure. They can also be tracked or monitored using the Bitcoin explorer. This has made its use crucial in fostering the ease of use of the digital currency.
However, the installation of Bitcoin ATMs which started in full swing early in 2021 has gradually seen a decline since the beginning of the year 2022. From its all-time high of over 2000 ATM units in August 2021, the number of installed ATMs fell by about 350 units in January this year.
This trend doesn’t seem to end as a downward slope has been noticed ever since. The number of installations keeps getting lower and lower. The net number of installations from January to February fell by a whopping 717 units, from February to March, it fell by 213 units, and from March to April, 18 units. This is its fifth month and it seems this situation is not about to improve as the number of installations so far stands at only 149 according to data provided by Coin ATM Radar.
This trend has led to worry among crypto enthusiasts worldwide as regards its implication for the Bitcoin economy.
The massive spike in the installation of crypto ATMs in mid-2021 was directly attributed to the public acceptance of Bitcoin as a legal tender by several governments, especially in El Salvador. This acceptance encouraged a lot of other governments to consider the use of cryptocurrency as a recognized form of exchange.
The president of El Salvador, Bukele, is especially famous for his loud and public support for Bitcoin and cryptocurrency in general. The country currently holds the record of being the third on the list of countries with the largest number of Bitcoin ATMs. The first on the list is the U.S, followed closely by Canada.
Probable Reason Behind Installation Slowdown
As earlier stated, the adoption of crypto fueled the spike in Bitcoin ATM installations. Conversely, the downward slope in the frequency of installations may be linked to the fact that there has been no recent public adoption of crypto by governments around the world.
Despite this development, Mexico seems to be forging ahead in its use of crypto ATMs. On the 26th of April, the senate-house of the country installed another Bitcoin ATM. This brings the total number of Bitcoin ATMs in the building to fourteen.
It should be noted, however, that Mexico is yet to legalize Bitcoin as a legal tender. But, Indira Kempis, a Mexican crypto enthusiast, and senator, publicly declared that she proposed a bill to foster the legal recognition of Bitcoin as a legal tender in Mexico.
In response to this, Salinas, a Bitcoin billionaire, commented that it was not going to be an easy task. This is due to the fact that the main feature of cryptocurrency, which is decentralization, poses a threat to the ‘monopoly and control’ of the country’s central bank over fiat.
He further commented that only a small percentage of people use cryptocurrency and it would take a significant amount of time before widespread or global adoption of cryptocurrency can be achieved.
If the bill is approved, Mexico will join the list of countries like El Salvador, Portugal, and Madeira among others in the Bitcoin legalization ‘league’.
El Salvador is home to about 205 ATMs, this amounts to more than 50% of the total sum of crypto ATMs found in Latin America. Popular crypto ATM manufacturer, Genesis Coin has still retained its topmost spot in terms of market share, having an approximate value of 42%. This is followed next by General Bytes, having an approximate market share of 22%.
The rate of Bitcoin ATM installations has had a downward acceleration in recent times, which has been worrisome as regards the overall health of the Bitcoin economy. However, we remain hopeful as we expect a change in the coming times.
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