New ATMs turn real money into Bitcoins

The machines will convert cash or funds from your bank account into the digital currency -- for a very real fee.

By Aimee Picchi Apr 4, 2013 3:10PM

Bank ATM (copyright Image Source/Corbis/Corbis)Bitcoins are taking a step into the real world, with an entrepreneur planning to introduce ATMs for the digital currency in Los Angeles and Cyprus. 


But there's a catch: Rather than dispensing cash, the Bitcoin ATMs will transform your hard-earned real money into the digital currency. On top of that, the ATMs will charge fees of about 3%, which is slightly more than what regular ATMs charge, according to CNN.


The ATMs will convert cash into Bitcoins stored in a Bitcoin wallet, or else will transform the cash stored in a personal Bitcoin account into the digital currency, according to the report. 


The electronic tellers were developed by 42-year old Jeff Berwick, who says he's had orders for hundreds of the ATMs from 30 countries. 


"It's been hard to get access to Bitcoins," Berwick told CNBC, explaining what spurred the idea for the devices. "You can trade them over the Internet, but it's not all that easy to do."


So what can you do with a Bitcoin? As my MSN moneyNOW colleague Kim Peterson wrote on Wednesday, you can use them on sites such as PizzaForCoins, which takes Bitcoin payments and then places pizza orders with companies such as Domino's (DPZ). 


But people are also buying Bitcoins to hedge against real currencies, viewing them as a new way to store their money. Their value has surged from about 4 cents in 2010 to more than $140 in recent weeks amid worries about the strength of government-backed currencies and the bank runs in Cyprus.


That's leading to concerns about Bitcoins themselves, with fears that the digital currency is in the midst of a bubble. Then there are concerns about the security of the virtual currency, which quickly lost 20% of its value last night after one of its top exchanges was hacked, according to CNBC.


But its freewheeling culture is one of the virtual currency's advantages, according to Berwick. 


"These are the kinds of really exciting innovations that can come from the free market," he said. "This monetary system we have today is much more dangerous than anything Bitcoin has."


More on moneyNOW

11Comments
Apr 4, 2013 9:08PM
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Gold has worked pretty well as a hedge against fiat currencies to date. All fiat currencies eventually go to a zero valuation. Yet gold has lumbered on through the centuries. If I were to take bets on which of these, physical gold, dollars, or bitcoins will be of any value in twenty years....I'll go with the gold.
Apr 4, 2013 9:35PM
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To me Bitcoins are a disaster waiting to happen...Has anyone ever held a Bitcoin in their hand.?.

 

Actually maybe they have? or I might have one in my hand now?...It's called air.

Apr 5, 2013 12:56AM
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No thanks, keep your shitcoins. Simply another pump and dump, ponzi style scheme. Online currency is not new. many have tried, all have failed, leaving only the originators with monetary gains.
Apr 4, 2013 10:55PM
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I have been reading about Bitcoins....sounds like an e-wallet. You have a learning curve to using them. I am not sure about it. The cyber- attacks, the internet going down could be a deterrent for me.
Apr 5, 2013 4:36AM
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How something like this is getting traction is beyond belief. Aren't there already enough scams out there.
Apr 5, 2013 3:18PM
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I've been using Bitcoin for purchases, payment, and transfers securely for over a year. As much as people here in the comments would like to argue against them without ever having used them, I'd like to just say that I use BTC on a daily basis and have helped many merchants in my city begin accepting Bitcoin as payment.

I wouldn't suggest putting all of your money into Bitcoin, as with any other thing, but to have a hundred dollars or two worth of BTC to spend is always handy.
Apr 5, 2013 11:40AM
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Have you ever help a dollar in your hand? It is just a piece of paper and nothing else...lol

Apr 5, 2013 11:02AM
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The more one researches this phenomena the clearer the reality that this is a scam. A real currency is denominated based upon a tangible asset class. Try as I might there is no clear answer to how a bit coin is valued.
Apr 5, 2013 11:41AM
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No edit button so I can't edit my previous post...lol what a system MSN
Apr 5, 2013 11:04AM
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Why should I waste any of my hard earned Quatloos on a Bitcoin?...
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