[Animats]

The fraud level in the Bitcoin world is so high that it makes South Florida look good.

There's a working Robocoin ATM at Hacker Dojo in Mountain View, CA. Nobody uses it. Nor should they. 15% bid/ask spread, 5% fee.

Incidentally, the retail price for an ordinary ATM machine is $2,000 to $4,500, depending on the features ordered. A standard through-the-wall bank ATM is about $9,500. Even if you order every option from cash deposit through biometrics, they don't cost $25,000.

[jboggan]

There's a big difference between an "ordinary ATM" machine and the NCR/Diebold machines that the large American banks deploy. Sure, you can get a Hyosung/Triton/Wincor/$whatever machine and it will technically function for the usual customer operations . . . but I would never order those machines if I were in a purchasing capacity because of physical security concerns. I've worked with enough damaged/compromised machines to see what is physically possible in a very short amount of time, and the cheaper machines aren't worth it.

I've found you get what you pay for in the ATM world when it comes to hardware. Software is another story altogether, but there's no cheap and easy solution for physical security. The bad thing about Bitcoin ATMs is that they have the same physical security problems but an extra set of information security problems, with none of the established and well tested solutions that have existed in the banking world for 30 years.

Forget Bitcoin ATMs for consumers - if you want to actually make money you should build a regular banking ATM network that uses Bitcoin/altcoins in the background for transaction processing. That would actually disrupt the industry and allow you to undercut the other networks' pricing models.

[krunkcoin]

"if you want to actually make money you should build a regular banking ATM network that uses Bitcoin/altcoins in the background for transaction processing. That would actually disrupt the industry and allow you to undercut the other networks' pricing models."

How exactly is this cost-based "disruption" supposed to work when Bitcoin and friends are outrageously expensive per transaction?

One of the funniest things about the entire Bitcoin movement is the way that self-styled experts babble on and on about how amazing a technical revolution cryptocurrency is, despite clearly not understanding the first thing about cryptocurrency technology. Bitcoin is an experimental attempt to solve the classic Byzantine Generals' Problem, which can be boiled down to "how can a public transaction ledger maintained by its own users (with no central authority) be resistant to attack by bad actors". The Bitcoin "solution" to this problem is, in essence, for each node on the network to provably waste energy in an exceedingly flagrant way, in hopes that the costs of taking over the network are too high for any individual bad actor.

Well guess what, my friend? That means Bitcoin ends up chewing ridiculous amounts of energy doing no useful work on the desired end product of the system -- the ledger of transactions. Trust-based systems (you know, the kind deployed by, say, a bank, which would like to believe it can run its own system) do not need to waste energy, because they aren't built on deliberately wasting energy.

Bitcoin only makes sense if you are fanatically dedicated to the notion that Gibsonian dystopias (wherein the collapse of public institutions requires development of cryptocurrency) are either inevitable or desirable. It certainly isn't going to disrupt the existing system by being more cost- or energy-efficient. It isn't, it can't be, and that's by design. (Since Nakamoto couldn't figure out a less-bad way of solving Byzantine Generals.)

[scintill76]

> The Bitcoin "solution" to this problem is, in essence, for each node on the network to provably waste energy in an exceedingly flagrant way, in hopes that the costs of taking over the network are too high for any individual bad actor

This is like saying, "The traditional banking 'solution' is to have a bunch of lawyers and government agencies waste time, paper, and ink drafting up and verifying documents, in hopes that the costs of taking over the system are too high for any individual bad actor." Obviously it's not perfect, but neither is any other financial system. They both serve a purpose: addressing problems that haven't been solved any other way, so it's not a waste.

I'm not even as rabid of a Bitcoin fan as some others, but it's just silly to read "OMG, mining costs energy!" when so does any other activity. At least put out some numbers to show how much more wasteful mining is than other systems, in your opinion. And who appointed you to decide which uses of energy are dumb/immoral/wasteful? Why do you care if miners are willing to buy electricity and electric companies are willing to sell it?

[icebraining]

Ordinary ATMs have economies of scale not available to Bitcoin ATMs, from simply making bigger purchases to distributing fixed costs (like software development). It's also a much safer business - you can be relatively sure the dollar economy won't crash tomorrow and kill your business.

[scott_karana]

I'm not sure about this. Since Bitcoin ATMs still dispense cash, why not just retrofit the same hardware?

Hell, why aren't people paying the smaller ATM companies to make custom ones? It's not like banks don't already get custom-shaped ATMs made for them.

[icebraining]

Since Bitcoin ATMs still dispense cash, why not just retrofit the same hardware?

You can use the same hardware, but when you're buying 10s instead of 1000s of them, it'll probably cost you a lot more per unit. At least that's how it works for most manufactured goods.

[scott_karana]

For sure. But a 400% difference is not usual for bulk purchases.

[raverbashing]

"Incidentally, the retail price for an ordinary ATM machine is $2,000 to $4,500"

But, but.... those banks know nothing about bitcoin, it's the future...

And of course, the markup is moot, because you didn't get the product.

[imaginenore]

That's the dumbest argument ever. You are comparing one of the most expensive bitcoin ATMs with the cheapest traditional ATMs. "But, but" is the core of your argument.

[wpietri]

Even granting Poe's Law, when somebody says something so dumb you can't believe it, it's often worth actually not believing it.

[raverbashing]

What's dumb is not knowing the price level of a product and paying the full amount without any warranty.