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How does a Bitcoin ATM work?
Bitcoin ATMs, also called crypto cash machines or BTMs, make it possible to buy or sell cryptocurrencies via a physical machine. On the outside they look like traditional cash machines, but technically they work in a completely different way. While a normal cash machine is connected to your bank account, a Bitcoin ATM is directly connected to a cryptocurrency exchange or the blockchain.
Instead of only withdrawing money from your bank account, you can use a Bitcoin ATM to, for example, use cash to buy Bitcoin. This makes crypto more accessible for people who prefer to work with cash or do not want to leave their bank details everywhere. In this article you read what a Bitcoin ATM exactly is, how the process runs in 2026 and what you should pay attention to regarding costs and security.
In short
A Bitcoin ATM is a physical device to buy crypto (and sometimes to sell).
You can often insert cash to have Bitcoin sent directly to your wallet.
In 2026, the machine almost always requires identification (KYC) due to EU regulations (MiCA).
Costs are considerably higher than at online platforms, sometimes up to 15%.
Worldwide there are more than 40,000 machines available in 2026, although the density in the Netherlands is limited.
What is a Bitcoin ATM?
A Bitcoin ATM is a machine with which you can acquire cryptocurrencies or, with the more advanced models, sell them for cash. The term 'ATM' (Automated Teller Machine) is actually a bit misleading: you do not connect to a bank balance, but you carry out a transaction on the internet. The machine functions as an interface between your cash and the decentralised network of the blockchain.
How does a Bitcoin ATM differ from a normal cash machine?
Although they are often in the same shops or stations, there are fundamental differences:
Traditional cash machine: Gives you access to your own bank account to physically withdraw or deposit money. The bank is the central administrator here.
Bitcoin ATM: Is an independent terminal that converts money into digital assets. You do not need a bank account to use the machine, but you do need your own crypto wallet (for example on your smartphone). The machine sends the purchased crypto directly to your unique blockchain address.
Availability in 2026
The number of Bitcoin ATMs worldwide has grown to over 40,000 installations. Especially in the United States and Australia, the growth has been explosive. In the Netherlands and the rest of the European Union, the supply is more stable, partly due to the strict legislation. In the Netherlands you find them mainly in the larger cities such as Amsterdam, Rotterdam and Utrecht, often in phone shops or convenience stores.
How does a Bitcoin ATM work?
The process is designed to be as user-friendly as possible, comparable to buying a train ticket.
The steps are usually as follows:
Identification: In 2026 you almost always have to verify your identity first. This can be done by scanning your ID card or verifying your phone number. This is a consequence of the MiCA legislation against money laundering.
Scan wallet: Open your crypto wallet on your phone and let the QR code of your receiving address be scanned by the camera of the machine.
Insert money: Insert the banknotes into the machine. The machine immediately shows how much Bitcoin (or another coin) you get for this at the current rate.
Confirm: As soon as you click 'Buy', the machine processes the transaction on the blockchain. Within a few minutes (depending on the traffic on the network) the crypto appears in your wallet.
Some "two-way" machines also offer the option to sell crypto. You then send crypto to the machine, wait for a confirmation from the blockchain, and the machine then gives you cash euros back.
What does using a Bitcoin ATM cost?
Convenience has a price, and with Bitcoin ATMs that price is often high. This is the biggest disadvantage of physical machines compared to online exchanges.
Transaction fees and spreads
The costs of a Bitcoin ATM usually consist of two parts:
Service fee: A fixed percentage that the provider charges for the maintenance and location of the machine. This is often between 7% and 12%.
Spread: The exchange rate in the machine is often less favourable than the actual market price on large exchanges. As a result, you indirectly pay another 2% to 5% extra.
In total, it is not unusual for you to lose 10% to 15% of your deposit to costs. By comparison: at an online platform such as Coinmerce you pay only a fraction of this.
Security and regulation in 2026
Bitcoin ATMs are generally safe, provided you use a machine from a recognised provider. Since the full introduction of the MiCA regulation (Markets in Crypto-Assets) on 1 July 2026, all providers of crypto machines in the EU must have a licence and comply with strict supervision rules.
Tips for safe use:
Check the rate: Look on your phone what the current rate is before you insert money, so that you know how much extra you pay.
Scan your own wallet: Never use a wallet address that is provided by someone else (or by the machine itself).
Privacy: Be aware that cameras at the machine and the mandatory ID scan mean that the transaction is not anonymous.
Bitcoin ATM vs online exchanges
The choice between a machine and an online platform depends on your priorities:
Feature | Bitcoin ATM | Online Exchange (Coinmerce)
Speed | Immediate (physical) | Immediate (digital)
Payment method | Cash / Card | iDEAL / Credit card / SEPA
Costs | High (10%+) | Low (<1%)
Privacy | Limited (ID required) | Regulated (KYC)
Ease of use | Physical machine | App on your phone
Frequently asked questions
How much does a Bitcoin transaction at a machine cost?
In addition to the service costs of the machine (7-12%), you also pay the standard 'miner fees' of the Bitcoin network itself. These costs are usually deducted directly from the amount you receive.
Do I need a bank account?
No, that is precisely one of the strong points of a Bitcoin ATM. You can enter the crypto world with cash. However, in 2026 you do need a valid identity document to be allowed to carry out the transaction.
Buying cryptocurrencies without high costs?
Although a Bitcoin ATM can be handy for quick cash transactions, the high costs are a barrier for many investors. Do you prefer to benefit from the sharpest rates and manage your portfolio clearly in one safe app? At Coinmerce you buy Bitcoin and hundreds of other cryptocurrencies easily with iDEAL or credit card at very low commissions. You do not have to leave the house for a physical machine; you trade where and when you want within a reliable, regulated environment. Create an account at Coinmerce today and start building your crypto wealth in a smart way.
