Many people in finance and retail considered 2021 the “year of the cryptocurrency.” In November, the mayor-elect of New York City, Eric Adams, sent a tweet saying he wants his first three paychecks to be paid in Bitcoin. While the NYC payroll department likely cannot do that, it signals the mayor’s intentions to encourage cryptocurrency adoption. Alternatively, retailers can add crypto.
Another major sign of broad usage and acceptance came with Walmart’s move to offer Bitcoin purchasing and selling through Bitcoin ATMs in 200 of its store locations. This modest start is only the beginning, with the retail giant stating plans for more than 8,000 such machines throughout its stores. This greatly expands the reach of the cryptocurrency to consumers, moving it beyond something that’s only used by tech enthusiasts or industry professionals. Through the use of crypto ATMs, people are able to purchase crypto safely and quickly. These machines function the same as traditional ATMs, with the extra capability of purchasing and storing cryptocurrencies. It’s a fast-growing market, with estimates stating it will reach $3.55 billion by 2030, a number that’s likely conservative as well-known retailers expand their footprint into this space.
Other retailers notice when leading industry players like Walmart or Circle K make a move, so many brands are now likely considering adding crypto payment options and Bitcoin ATMs to their stores. There are several best practices retail executives should keep in mind before diving into cryptocurrency, however, so here are a few considerations and tips.
1. Pick the right location(s).
According to Coin ATM Radar, as of December 2021 there were more than 30,000 cryptocurrency ATMs around the world. This amount stood at 14,016 machines at the start of the year, reflecting a massive growth rate as retailers throughout the world see the benefits of these machines.
Cryptocurrency ATM operators at first followed many of the same strategies as traditional ATM machine providers. This included placing the machines in 24-hour gas stations and convenience stores. This is still a sound strategy for these operators; however, the market’s now grown to placement in bigger retail chains. Brands should carefully consider the placement of their Bitcoin ATMs to drive adoption and repeated usage. They need to map out the physical space requirements for the Bitcoin machine, and optimize its placement based on foot traffic and other considerations.
Retailers also need to ensure that their machines are findable via searches. This includes Google Maps searches as well as on various sites that post the location of the customer’s closest cryptocurrency ATM. For example, machines provided by Bitcoin Depot appear on several networks that provide operators with greater exposure to larger customer pools. Companies should also add the presence of the cryptocurrency ATMs to their store websites and marketing materials.
2. Understand regulations and security.
Despite sharing the same acronym, traditional ATMs aren’t interchangeable technologically with cryptocurrency ATMs. There’s no “retrofitting” process; firms need to purchase a new type of machine that can securely handle cryptocurrency purchases, sales and investing, and also produce fiat currency such as dollars. These machines use encryption and other technology to ensure user security, and they follow many of the same safeguards as traditional ATMs. Retail brands should offer customers printed and online content about the Bitcoin ATM’s security standards and engage in marketing efforts to address any concerns and common questions.
There are multiple state-by-state regulations governing cryptocurrency transactions and ATMs. Operators are encouraged to understand these regulations and lean on the expertise of a multi-state provider and a trusted partner that understands and follows those regulations.
3. Understand and advocate cryptocurrency.
While retailers won’t be able to answer all the consumer public’s questions about crypto and the new ATMs, they should offer training to some staff members to function as the in-store experts. Bitcoin ATMs require users to have a preferred cryptocurrency wallet, a secure place to store and manage various currencies. They need a wallet to receive Bitcoin and other cryptocurrencies like Ethereum or Dogecoin. Many providers offer their own integrated wallet; however, users can utilize their own preferred wallet from one of the many providers. To complete a purchase takes just a minute. Buyers confirm a purchase amount, scan the wallet QR code and then insert cash into the machine to complete the transaction. They now own the cryptocurrency, and they can later sell it through the machine or accumulate it over time as an investment.
Retail store operators can learn about wallets and the cryptocurrencies available for purchase so they have more context about customer questions and can add value to their Bitcoin ATM commissions. Retailers benefit from the commissions, and from the increased foot traffic by customers attracted to the cryptocurrency ATMs within the store. They can build a reputation for service and knowledge that produces word-of-mouth referrals for other cryptocurrency buyers.
4. Leverage a strategic partner.
A top-tier cryptocurrency ATM provider offers multiple services for retailers that ensure they receive optimal revenue with minimal time expended. Retail brands should consider a vendor such as Bitcoin Depot that features maintenance and support services, which keep the machines running for a smooth customer experience that enhances the brand’s reputation. An experienced cryptocurrency ATM partner prevents poor consumer reviews, which can then impact the buying decisions of all customers, not just those looking for a Bitcoin ATM. Top vendors will also utilize armored truck companies and handle the logistics of moving fiat currency from the machines to a bank.
The cryptocurrency market has grown to more than $3 trillion. It’s too big for retailers, investors and banks to ignore, so they’re all diving into the space. Retailers that call crypto a passing fad will miss opportunities in 2022 and beyond, unless they pivot to innovative technology and bring on cryptocurrency service offerings. Retailers can add crypto.
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