Dallas Now Has a Bitcoin ATM

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bitcoinatm.JPG
Jimmy Scott
Here it is, Dallas' first Bitcoin ATM in all its glory.
Late last month, we told you about BTCity, a startup trying to find the perfect site for the company's Bitcoin ATM, expected to be the first in Dallas. BTCity still hasn't managed to get its machine up and running, but a local entrepreneur took the company's plans as an opportunity to speed up his timeline for getting his own ATM installed.

See also: Bitcoin ATM Startup Hoping to Plant Its Flag in Dallas

This week he won the race, placing the ATM pictured above into Buzzbrews' Deep Ellum location.

"I had ordered [the ATM] like a month ago and I was slowly trying to figure out legally what I needed to do. I saw [the BTCity article] so I really jumped the gun on trying to find a place to it," Jimmy Scott says. "I can't let this guy from out of town come beat me."

bcbuzz.JPG
Jimmy Scott
Buzzbrews Deep Ellum

Scott, a recent college graduate, started trading Bitcoins about six months ago with some savings and a gift from his mother. He used LocalBitcoins, a Craig's List-like service that facilitates Bitcoin transactions to buy the digital currency because it can take up to a month to establish an account with a larger exchange like Coinbase or Bitstamp, he says.

"A popular way [to buy Bitcoins on LocalBitcoins] is by cash deposit and I had some guys out there running fraud through my account, so basically, I'm trying to find the safest way for people to buy and sell Bitcoins. To me [the ATM] is it," he says.

So far, Scott's machine has only seen one transaction, but Buzzbrews owner Ernest Belmore looks forward to his restaurant being on the cutting edge and supporting the burgeoning means of exchange.

"I think that it's a form of competition in the marketplace that will raise some eyebrows a hopefully create policy to kind of keep our other financial currency in check, if it does grow and it does stick," he says. "It shows signs of doing that with the people that are supporting it and the positions they hold."

A key difference between the machine at Buzzbrews -- which Belmore is both hosting rent free and providing the electricity for -- and the one planned by BTCity is that transactions at the machine can only be made one way. Bitcoins can be purchased with cash, in increments of up to $1,000, but the ATM will not provide any cash out. This lowers the security risk -- two-way Bitcoin ATMs can hold hundreds of thousands of dollars -- and leaves Scott subject to lesser regulations.

Even in Texas, which has the United States' friendliest Bitcoin regulations, providing transactions of more than $1,000 or cash out would have caused licensing and fee headaches.

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60 comments
cman
cman

Money in a bank is just digital information. Bitcoins are better digital information. Bitcoins is a experimental economy. So even if it doesn't pan out, it gives us information on how to do things better.

nicholasmarc
nicholasmarc

So a machine which turns real money into fake money.

ColonelAngus
ColonelAngus

What is the exchange rate for Bitcoin to Schrutebucks?

Chattering_Monkey
Chattering_Monkey

Hey guys, give me $525 and Ill give you 1 bitcoin that is pretty much worth nothing to 99% of people.  seems like a great investment, consider I can use that bitcoin just about no where useful to me

degan367
degan367

Spent about $3k on mining hardware and mined alt coins, then traded them on various exchanges like mintpal, cryptsy and biter for bitcoin since March of 2014.  I have then sold my bitcoins on coinbase for about $8K.  That's $5K profit with just a few mouse clicks a day to make trades and then cashout.  I'm glad I got into bitcoin.

TheCredibleHulk
TheCredibleHulk topcommenter

Yes, please place $1000 dollars U.S. into my machine and I will award you 1 million of my "net-coins" that can be placed into a "virtual wallet" that I will gladly sell to you for 200 of said "net-coins".

ChrisYu
ChrisYu

Now with one convenient location!

mikeg4936
mikeg4936

Nice - but can I buy some buzzbrews with my bitcoin?

ryan.overton
ryan.overton

Everyone will be using the blockchain protocol/bitcoin soon, even if they don't know they are using it.  It's just a matter of time, much like the music/video industry or email even.

Montemalone
Montemalone topcommenter

I can't believe people are jumping into this scam.

Even legitimate businesses accept it. If I had any I'd spend it as fast as possible.

The things trade like precious metals, with a constantly fluctuating "value", but there's nothing there.

At least with gold or silver, you can use it even if the price crashes.

ThePosterFormerlyKnownasPaul
ThePosterFormerlyKnownasPaul topcommenter

Ooooh!  It's on the internet!  It has to be true!  I'm going to suspend all disbelief and critical thinking!


At least derivatives supposedly have an underlying asset.

d-may
d-may

Bitcoin is a really stupid way to store your money. Here is why:

With a bank, if your account is hacked or your identity and money is stolen, it's just a major head ache. Your account is insured and you will get your money back, though it might take a week or so. It's annoying, but you will get your money back.  

With bitcoin, your wallet will get hacked and your money will be gone forever.  It's not a matter of "if", your wallet will get hacked, and It's gone. Forever. There is no insurance. It will be gone. The end. 





nicholasmarc
nicholasmarc

People only buy bitcoins bc they want to sell them later for a profit. The value is extremely erratic and unpredictable, so the claim that it's more stable than the US dollar goes out the window. Almost nobody accepts them (not even this bitcoin ATM), and the few legit places that do also accept dollars.

degan367
degan367

@Chattering_Monkey Where did you get that 1 bitcoin, mining or did you buy it?  If you bought below current $525 market value and sold higher, then good job.  If you sell above what you pay for it, then you lost money.  Just like stock, buy low, sell high and cashout to fiat if you want.

MaxNoDifference
MaxNoDifference

@TheCredibleHulk  I will gladly pay you Tuesday for a bitcoin for a hamburger today

ghkyluhhje
ghkyluhhje

@ryan.overton  Actually, the reverse is actually the case: because bitcoin s not a legit currency, speculators will always evaluate it in terms of how much profit they can make in real currency off of bitcoin. It's a virtual commodity for morons.

jmckee3
jmckee3

@Montemalone My favorite one word explanation of Bitcoin is Dunning-Krugerrands. 


It's a nice idea in theory, as Bitcoin is implemented, as Bitcoin will ever be implemented it is in practice tremendously flawed and completely incapable of being scaled to anything remotely useful. But people think they are first to the game with Bitcoin and greed has set in, they refuse to understand that even if we were to accept that something like Bitcoin might be a viable option at some point in the future it will never, ever, ever be Bitcoin because there is no reason for it to be Bitcoin and there being thousands and thousands of reasons why using Bitcoin as a currency or a commodity as it is fundamentally designed is idiotic. 

Dudeman
Dudeman

@d-may


There's some misinformation here..on both sides.


Bitcoin is equivalent to cash. If someone takes your cash and spends it, it's gone. In fact, it's more 'gone' than bitcoin because there's no blockchain to see where your coins were transferred to. Bitcoin as a protocol doesn't care who's money it is (and nor should it). You should never compare what a bank does with virtual fiat currency to what bitcoin (or exchanges) do because they are not the same.


There are certainly services built around BitCoin are starting to have the consumer protection of banks and credit card companies...places like Coinbase and BitPay.  The companies are based in the US, thus the follow and are subject to US legislation and are not completely comparable to the exchanges that are based out of random countries. There's also Multi-signature release that became a part of the latest protocol release. Multi-signature requires two correct QR codes/hash codes to release the money.


As the BitCoin community grows from an enthusiast/techie-driven resource to a consumer-oriented there will be more and more services that spring up around giving the consumer a better platform to store and handle Bitcoin.


Bitcoin it'self isn't without it's faults. You have the 51% mining issue. Also, here's a central problem of the blockchain exponentially growing in file-size as more transactions happen. Soon it will grow to the size where the only viable solution to store the blockchain would be in data-centers thus centralizing it.

buckeyefreak18
buckeyefreak18

@d-may Ultimately somebody is held responsible and has to pay for that mistake.  If you properly secure your password and don't let your identity become vulnerable, Bitcoin is much safer that leaving your money in the bank.  Just come up with a good password and don't send money to the wrong place. 

nicholasmarc
nicholasmarc

Does it accept the bitcoins printed by this ATM?

ScottsMerkin
ScottsMerkin topcommenter

@ghkyluhhje @ryan.overton bitcoin seems like a pyramid/mlm scheme.  The ones at the top make all the money.  If just one of the exchanges goes off line, the community collapses and there is no recourse to the man who ran with the money

jesse.busma
jesse.busma

@Dudeman I take massive issue with you saying blockchain can will only be able to be stored in large data centers and lead to centralization


Even today, we have 64GB micro SD cards which can fit three copies of the BC onto something smaller than a postage stamp.


The BC is growing at an exponential rate, but storage space is growing logarithmically.

https://en.wikipedia.org/wiki/File:Hard_drive_capacity_over_time.png


Even the most basic laptos come with 500GB capacty nowadays, and a 3TB drive costs just over $100.

degan367
degan367

@buckeyefreak18 @d-may Use a free product like Armory Wallet and it will put your private keys on a pc not connected to the internet.  It's the most secure way to prevent left as long as your online hot wallet keys are on on offline PC.  You can also back up those wallets on multiple thumb drives in case your PCs crash.

d-may
d-may

@buckeyefreak18 @d-may Passwords are inherently insecure. Trusting your money to a password is like locking your money in a shed behind your house with a master lock. It'll keep most of the people that weren't going to steal your money anyway out. 

ScottsMerkin
ScottsMerkin topcommenter

@buckeyefreak18 @d-may right, a good password. until one of the bitcoin exchanges goes rogue and sells off your info.  Nothing is 100% secure, nothing.  Please explain how having bitcoin is safer than having money in a bank?

degan367
degan367

@James080 @degan367 @Chattering_Monkey 

You use computers running mining software like CGminer to mine the coins.  Bitcoin is to hard to mine directly since the difficulty rate went up so you would need to invest in hundreds of thousands of dollars in ASIC mining gear to make it worth it.  Bitcoin uses sha256 mining algorithm.  So the bitcoin ASIC miners are specific to sha256 algo.  Most folks use regular motherboards with up to 6 GPUs to mine alternate coins like litecoin or dogecoin which are scrypt algo and then trade those for bitcoin. If you don't want to mine scrypt based coins, you can mine X11, scrpty-n, cryptonite or any other algo.  Each alt coin may use any algo the developer chooses and with GPU based mining gear, you can mine any algo.  If you by a sha256 or scrypt ASIC miner, then you can only mine the coins with that specific algo.  ASIC are expensive but scrypt ASIC are coming down in price.  I use GPU based gear to mine a cryptonite algo coin called Monero and trade them for bitcoin.  I use to mine vertcoin which uses scrypt-n algo.  Hope this helps explain how to mine.

dkmestre
dkmestre

@ScottsMerkin @ghkyluhhje @ryan.overton A pyramid scheme relies on the promise of making money on your investment. Being that bitcoin is decentralized and cannot be owned by 1 person/entity, no one can make that promise. Anyone who tells you can make loads of money by investing in bitcoin is simply a fool.


Also, since there are many exchanges (as well as a means of exchanging locally), having 1 exchange go down means nothing. People were initially shocked by MtGox going down, but that goes to show nothing in the bitcoin space is "too big to fail", and the incompetent get weeded out.

jesse.busma
jesse.busma

@d-may @buckeyefreak18 You're right! But what if I told you the password used in every bitcoin "account" (your private key) is a rand number between 1 and 2^256?

That doesn't seem like a big enough number?

2^256 =115792089237316195423570985008687907853269984665
640564039457584007913129639936

That number is too big for me to even think about putting in commas into it. This compared to the chance of someone guessing you 12 digit bank account number, or you snn and hardly think you lie awake at night about people guessing those numbers.


Still not convinced that passwords are "secure"?

http://miguelmoreno.net/wp-content/uploads/2013/05/fYFBsqp.jpg


If you have a minute read this article, it explains how using our current knowledge of thermodynamics and quantum computing, the sun would actually burn out before someone guessed your private key :)

jesse.busma
jesse.busma

@ScottsMerkin @buckeyefreak18 @d-may

Web exchanges, actaully don't have the ability to sell your password, most passwords are stored as a salted hash and checked for confirmation.

Most people store their private keys locally, where no one has access to them, using a strong pass phrase to do the encryption. Only a fool would leave coins on an exchange or web-wallet.

You say your money is insured, and you're correct!

The FDIC promises to reimburse your losses up to $250,000 If you only strive to ever have this much in life, congratulations, you're safe.

Except, have you checked the FDIC budget lately?


In last year's report: http://consultingbyrpm.com/wp-content/uploads/2014/07/FDIC.png

The dollars are in millions, and the numbers to the right are %


According to this only 0.79% of domestic, insured deposits are in the FDIC fund.

If a major bank failure were to occur, whether it be inflation from quantitative easing, bad loan practices, or other reason for collapse of the dollar, are you hoping the other 99.21% comes from taxpayers? Or directly from consumers who left over $250,000 in an account (see: Cyprus)

So the question becomes, what's more likely, a major bank run, and consequential hyperinflation, rendering savings worthless, or the likelihood someone will crack 256-bit encryption?

People put their investments in what they beleive in. For those who trust their governments, and don't place confidence in their own computer knowledge, the dollar is a great choice!

For those who beleive in math, a distributed consensus, and returning the power of the issuance of currency to the people, coupled with a distrust of their government, or the federal reserve, bitcoin is their choice.

degan367
degan367

@James080 @degan367 @Chattering_Monkey 


Back in the day when there was only bitcoin, people could use laptops with just their CPUs to mine hundred of bitcoins a day because the difficulty rate was so low, but as bitcoin got popular, the bitcoin algo is designed to reward miners with less bitcoin as more people join the network to mine to control the inflation rate.  Once the diff rate went up to high people found out that it was more efficient to mine with video cards (GPUs) and the hashing power what multiplied by the hundred over CPUs so more coins were rewarded but all this did was to make the difficulty rate shoot up it to eventually made mining bitcoin harder.  Then manufactured came out with ASIC miners with multiplied the hashing power by the 10ns of thousands.  See where the went, the bitcoin network difficulty is so higher so only people with ASIC miners can mine bitcoin directly and all the GPU miners went to other alt coins like Litecoin to trade for bitcoin.  Now there are scrypt ASIC out now and the cycle repeats.  Us GPU miners have to find other coins to mine for bitcoin since scrypt based coins difficulty rate are shooting up and require more hashing power from ASIC just to make it profitable to mine.

WaitWhat
WaitWhat

@jesse.busma @ScottsMerkin @buckeyefreak18 @d-may 

Banks pay interest.  You're losing money everyday if you keep that much money in bitcoin or cash.


If the US Banking system melts down, you think bitcoin will survive, backed by the full faith and credit of other bitcoin owners?  You're better off with gold, along with lots of canned food and ammunition.

degan367
degan367

@James080 @degan367 @Chattering_Monkey 

You may ask why mine instead of just not buy bitcoin from coinbase or other exchanges low and sell them when bitcoin value go high like a investor would?  The bitcoin network needs miners to confirm the transaction anytime there is a transfer from one bitcoin address to another.  So without miners, they would be no one to verify the accuracy of the bitcoin blockchain (public ledger) to prevent double spending of coins.

jesse.busma
jesse.busma

@nicholasmarc @jesse.busma @ScottsMerkin @buckeyefreak18 @d-may

The size of the investment is really irrelevant in whether it's good or not. Conversely, the amount I have invested in bitcoin is not the measure for how much I think it's a good investment. if I had $1 million in cash, probably 250k would be in bitcoin.

There are two ways of looking at this investment. The immediate cycles, or the long term outcome.

Bitcoin's history is littered with bubbles and crashes. With a small ~7bil market cap, it doesnt take much to rock the boat.

I beleive bitcoin will either be worth millions or nothing.
I'm not concerned with the day to day price. Either it will swallow up the legacy payment system, or it will be regulated out of existence.

jesse.busma
jesse.busma

@WaitWhat @jesse.busma @ScottsMerkin @buckeyefreak18 @d-may 

What interest rate do you get?

I have high interest checking from chase, and get about 3 cents a month. This is hardly enough to counteract the CPI (consumer price index) reported increase of 3-6% anually.


http://www.usinflationcalculator.com/inflation/consumer-price-index-and-annual-percent-changes-from-1913-to-2008/

If you're limiting the scope of the economic failure to the US, your gold/bitcoin will retain it's store of worth, and perhaps even increase in value as people begin to further distrust, government issued fiat currency.

When you bring in guns, ammo, and food/water into the mix, I highly doubt your gold bullion will do you much good ;) Plenty of hungry bandits would gladly take your life and food instead of a rock.

Gold's intrinsic value lies in the fact that its pretty, somewhat rare, and has a handful of industrial applications.

Bitcoin's intrinsic value lies in a payment protocol, controlled by users instead of administrators, that is verified, and secured by the laws of mathematics.

degan367
degan367

@James080 @degan367 @Chattering_Monkey BTW- there will only ever be 21 million bitcoins ever created.  Only about 13 million have been mined so far.  It is expected that the last bitcoin mined with be in the next 30 years.  It's not like there are trillions of bitcoin out there.  Its a fixed number and it getting harder and harder to mine bitcoins so everyone if fighter over the 13 million out there and only about roughly 3600 bitcoins get created in a day by mining it directly.  Only those with huge bitcoin mining farms who have spent a shit ton of money are making any profits mining bitcoin directly.  Every 4 years the number gets halved.

There is a story of a guy who mined 10,000 bitcoins in the beginning of bitcoin in 2009 and sold them to someone for a pizza.  Bitcoin hit $1,200 last December.  Do the math, the guy who mined the 10K bitcoin would have been a millionaire if he kept them and waited.  There is big money is crytpo currency so everyone who missed the bitcoin train is trying to find the next big alt coin to mine or invest in to make money.

nicholasmarc
nicholasmarc

See, real investors determine the size of their investment according to risk, so it's completely relevant. Plus, there is almost no real liquidity in bitcoin, and if the market drops, you're stuck with a bunk investment. That's why a larger investment is more dangerous. Also you seem to have neglected the fact that all of the supposed benefits of bitcoin (stability in price, ease of exchange, perceived trustworthiness) are nonexistent so it will most likely evaporate on its own.

If it ever did become a legitimate market, it would be so easy for one wealthy person to shortsell it and crash the whole market. George soros did that and broke the Bank of England, so it would take nothing to do it to bitcoin.

jesse.busma
jesse.busma

@nicholasmarc


>See, real investors determine the size of their investment >according to risk, so it's completely relevant.


True Scotsman falacy. The size of an investment is proportional to someone's wealth.


>Plus, there is almost no real liquidity in bitcoin, and if the >market drops, you're stuck with a bunk investment


If ANY market drops, you're stuck with a bunk investment.



>Also you seem to have neglected the fact that all of the >supposed benefits of bitcoin (stability in price, ease of >exchange, perceived trustworthiness) are nonexistent so >it will most likely evaporate on its own.

Straw man fallacy, I never claimed bitcoin's stability, and never commented on it's ease of exchange or trustworthineess.

Bitcoin is fundamentally effortless to transfer. It's also a trustless protocol, meaning you can audit the code, and operate in a manner which does not require you to trust anyone else, even the original creator.


>If it ever did become a legitimate market

What makes a market "legitimate"?

>George soros did that and broke the Bank of England, so >it would take nothing to do it to bitcoin.

You literally copied his sensationalist nick name, with zero understanding of what Soros actually did.

He did not cause a full crash of the pound, he simply leveraged the UK's decision to not raise interest raise on a currency exchange.

He made a massive short on the pound, and eventually the UK pulled their currency off of the exchange.

Because bitcoin is not controlled by a single point of failure, but rather network consensus, it is not prone to manipulation like government issued currency.

And finally, because bitcoin is peer to peer, and not limited by a single point of failure, there is not way that bitcoin could choose to remove itself from an exchange.

In the case of George Soros, the choices of the government controlling the currency are directly responsible. For bitcoin, it's a majority vote of the network, not greedy politicians that decide these things.

jesse.busma
jesse.busma

@ScottsMerkin @jesse.busma @buckeyefreak18 @d-may

It is definitely, and it's why I still keep most of my money in dollars! That being said, I throw a little pocket change away because I firmly beleive inflation is massive.

How much did your father buy his first house for?

Today houses (in CA, not near the beach) cost upwards of $750k

Was real estate a great investment, or was the dollar simply eroding?

I think both, but the CPI shows atleast one is true.

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