First Bitcoin ATM opens in Vancouver coffee shop

Digital currency machine the first of five across Canada

Jeff Hudson poses for a picture in front of, according to co-founders of Vancouver Bitcoiniacs Trading Company, the world's first bitcoin ATM machine. It goes live Tuesday at Waves Coffee House in Vancouver.

Canada, bitcoins, digital currency, kiosks, Bitcoiniacs, RoboCoin

Alexandra PosadzkiThe Canadian Press

The first time Ryan Johnson bought Bitcoins — an emerging digital currency that isn’t controlled by any authority such as a central bank — it was with a pocket full of cash from a stranger he had met online.

“It was almost like a sketchy drug deal,” recalls the 31-year-old Vancouver resident.

Since that first transaction in January, Johnson has been exchanging his Canadian cash for digital currency at Bitcoiniacs, a shop in Vancouver that acts like a Bitcoin broker.

“It’s just much more comfortable to go sit down in an office at a brick-and-mortar building with a professional that knows a lot about Bitcoins, do a professional transaction and get a receipt for it,” says Johnson. “It’s reassuring.”

Starting Tuesday, Johnson and other Canadian enthusiasts can exchange cash for the digital currency through a kiosk similar to an ATM. Bitcoiniacs is installing the first of its five Bitcoin kiosks from a Las Vegas-based company called RoboCoin.

Four more kiosks will arrive in December, possibly in Toronto, Montreal, Calgary and Ottawa.

“Basically, it just make it easier for people to buy and sell Bitcoins and hopefully will drive the adoption of Bitcoin, and make it more accessible for people,” says Mitchell Demeter, the 27-year-old owner of Bitcoiniacs.

Bitcoins are mathematically generated through a series of commands executed by computers in a peer-to-peer network. The process is called Bitcoin “mining” and is set up so that the total number of Bitcoins that can ever be generated is limited to about 21 million.

While some have doubted Bitcoin’s validity and others have raised concerns that the unregulated currency is being used for illegal deals, a U.S. judge ruled last month that Bitcoin, which has been around since 2009, is a real currency.

Currently, acquiring Bitcoins is often done through an exchange, an arduous process that requires users to jump through several hoops, including linking their bank account to the exchange and sending in paperwork to verify their identity.

When Toronto resident Robert Burko signed up with a Canadian Bitcoin exchange in April, he says it took more than 10 days — “an eternity” — for his account to get verified.

By then the price of Bitcoin had ballooned to around $260 (U.S.) before falling back down to closer to $100, and Burko had missed his chance to cash out.

“I didn’t really want a long-term investment opportunity in Bitcoins. I wanted a short-term one,” Burko says. “And because they took so long to verify my account I missed out on that entire window, which was very frustrating.”

The alternative to using an exchange is to find someone who wants to sell their Bitcoins on an online forum, meet up with them in person, hand them some cash and scan each other’s smartphones to transfer the Bitcoins to your digital wallet.

The RoboCoin kiosks are expected to make the process much easier, says Jordan Kelley, the company’s chief executive. “Our goal is to make Bitcoin truly grandma-friendly,” says Kelley.