On Sept. 30, a Shell gas station just off Chain Bridge Road became home to Fairfax County’s first bitcoin ATM.
The sleek novelty of the bitcoin machine, which was installed by the company Virtual ATM LLC and sits beside the gas station convenience store’s entrance, stands out amidst its mundane surroundings and in comparison to the relative modesty of a nearby regular ATM.
“This particular location we like because there’s a lot of traffic going by here, it’s near George Mason University, and more importantly, it’s open 24 hours a day,” John McKee, Virtual ATM’s founder and owner, explained.
Bitcoin is a form of digital money, though the Internal Revenue Service currently classifies it as an asset rather than a currency. The ATM lets customers convert cash into bitcoins or vice versa. McKee refers to the transaction as a “handshake” between the physical world and the virtual one.
The Fairfax Shell station houses one of four bitcoin kiosks in the Northern Virginia and Washington, D.C. area. The other three are located at the restaurant Spice on Wilson Boulevard in Arlington, The Diner on 18th Street in D.C., and the Amsterdam Falafel Shop on 14th Street in D.C.
While users can both purchase and sell bitcoins with the Shell and The Diner machines, the Spice and Amsterdam Falafel Shop ATMs only allow cash-to-bitcoin transactions.
Created in 2009 by software developer Satoshi Nakamoto, bitcoin differs from traditional currency in that it’s decentralized, meaning that it operates independently of any central authorities or institutions like banks, according to the digital currency news site CoinDesk.
“It’s a true peer-to-peer transaction,” McKee said. “There’s no government or no stock market where you’d have a company behind it. Bitcoin just has people behind it, buying it and selling it, so people actually make the market.”
Bitcoin appeals to users because of its anonymity, since it doesn’t require the disclosure of personal information like an email address or credit card number. At the same time, all transactions are recorded in an open, online database at blockchain.info, which offers some measure of transparency.
In addition, though Virtual ATM charges an ATM fee that varies depending on the volume of a particular transaction, bitcoin has no fees for international transfers, making it easier and faster to send money to other people around the world. Recipients can then either keep the bitcoins or convert it into their local currency.
Though bitcoin is still in the early adoption phase, it’s now accepted by some online retailers, such as Amazon, Expedia, Microsoft and Overstock.com.
According to McKee, the main downside to bitcoin for consumers is its unpredictability. Its price and value fluctuates a lot because nothing is backing it.
McKee says that, along with offering an alternate payment system, bitcoin is fascinating because some banks and other companies are using the technology behind it to identify legal documents, authenticate artwork and even eliminate voter fraud.
“It’s sort of like a digital stamp on everything that you do,” McKee said.
While Virtual ATM hasn’t announced new locations for additional bitcoin ATMs, the company is talking to potential clients. McKee says he can’t discuss the possible locations yet because none of them have been finalized.
“Our goal is to strategically place these in various locations where there’s high foot traffic or car traffic, usually in a demographic area that understands technology,” McKee said. “Those are kind of the areas we’re looking for.”