How the Bitcoin ATM Business Can Be Profitable for Anyone
The value of bitcoin and other cryptocurrencies continues to fluctuate, but that does not stop more people from getting on the crypto bandwagon. While most people still turn online when they wish to buy or sell bitcoins (or other cryptocurrencies), many now prefer the convenience that bitcoin ATMs offer. Given that the existing market can do with more such ATMs, it might be worth your while to look at this from a business point of view.
What Numbers Say
To understand how well-entrenched the world is in cryptocurrencies, it helps to look at the Crypto ATM Market Research Report released by Market Data Forecast. It points out that the value of the global crypto market stood at $6.8 billion in 2021 and it is set to grow at an annual rate of more than 50% over the next five years. It is pegged to reach $864.38 billion by the end of 2027.
Given the evolution in bitcoin ATM technology, their numbers continue to rise. Data released by howmanybitcoinatms.com indicates that there are more than 50,500 bitcoin ATMs in the U.S. LibertyX has the largest network of bitcoin ATMs across the country, accounting for almost 25% of the market share. What helps is that the market is still in a relatively nascent stage, and there’s plenty of room even for small players.
What Makes the Bitcoin ATM Business Profitable?
While the bitcoin ATM business comes with its share of pros and cons, there’s no denying the profitability factor that it brings to the table. Besides, you don’t even have to own a store. All you need to do is find a store owner who is willing to offer space for the ATM for a fee. Since store owners benefit by placing ATMs at their locations, finding someone to agree is not particularly difficult.
What makes a bitcoin ATM business profitable is essentially the revenue you earn in the form of ATM fees. According to The Motley Fool, this typically varies from 9% to 12% of each transaction, although it can be as high as 20% in some cases.
Bitcoin ATM machines at good locations may see transactions of around $30,000 per month. If you go with 10% fees, you’ll be looking at around $3,000 in revenue each month. However, you also need to account for your expenses. For instance, you could pay:
- Around $200 to $400 for rent
- Around $30 for supplies
- Around $100 to meet compliance-related costs
This would still leave you with a profit of around or over $2,500. Bear in mind that these numbers are purely indicative, and bitcoin ATM machines may experience lower or higher volumes based on multiple factors.
One of the key factors that play a role in the profitability of a bitcoin ATM is the rent you end up paying. For example, you’ll need to pay higher rent to install an ATM in a shopping mall as opposed to a standalone grocery or liquor store. By crunching your numbers before taking the plunge, you’ll have a fair indication of what to expect going forward.
Should you need any advice, or if you’re looking for a suitable type of bitcoin ATM machine to buy, consider getting in touch with an ATM provider that specializes in this segment.