The owner of the kiosk located in Imbibe on Central Avenue, former Yahoo executive Eric Stromberg, credits the machine for streamlining the process of converting cash to the virtual currency — a process he said normally involves buying off another person or going through various online exchanges and sources that typically involve identity verification and a bank account.
“For the customers, the entire process is reduced from days or weeks to minutes or seconds with minimal information required,” he told the Journal.
Stromberg and the kiosk’s manufacturer, Lamassu Inc., say the Albuquerque machine was the first to open in the United States. Other machines already are in operation in Australia, Canada, Finland, Germany and Slovakia, a Lamassu spokeswoman said. Another was slated to go live Wednesday in Boston.
Unlike an ATM, the Lamassu machine only accepts cash in return for bitcoin. It doesn’t do the reverse. Various media reports indicate two-way exchange machines from a different maker are expected to launch soon in Austin and Seattle.
Stromberg said he moved to Albuquerque from the San Francisco area a month ago to launch Enchanted Bitcoins. He zeroed in on the Duke City because New Mexico has less stringent regulatory requirements for money-services businesses.
New Mexico is one of a few states that does not require a license for money transmitters, he said.
In California, Stromberg said, opening a kiosk would have required much more time and money.
Stromberg picked Imbibe as his first location after considering about 30 other venues throughout the city.
The Albuquerque machine has been operational since Feb. 10, Stromberg said, though it began drawing national attention when it formally was announced in a news release Tuesday.
Lamassu touts its kiosk as “cash to bitcoin in only three simple steps.” And while the desktop-sized machine swiftly handles each transaction — scanning bitcoin QR codes, accepting the cash and calculating the dollar-to-bitcoin exchange rate — the Imbibe setup also features an attendant.
Stromberg himself mans the machine and collects names, addresses and phone numbers from each buyer. It’s a record-keeping process intended to thwart potential money laundering and to keep the operation compliant with federal regulations.
He also has set a current maximum of $1,000 per transaction.
Stromberg, who said he has grown “fairly obsessed” with bitcoin in the last year, said Imbibe appealed to him because of its proximity to the University of New Mexico and because owner Wesley Golden also expressed enthusiasm about the venture.
Plus, as Stromberg noted while puffing on a cigar next to the machine, “This is one of my favorite places, so I was thrilled he was into it.”
Stromberg and the machine now occupy a corner of the cigar bar lounge. It is open daily from 12:30-2 p.m. and 6-10 p.m.
Lamassu, a company based in the British Virgin Islands, makes the $5,000 kiosks.
A Lamassu spokeswoman said Wednesday that it has sold about 200 machines.
“There are several other people in the U.S. who have machines and are waiting to figure out the regulatory compliance issues before making the machines available to the public,” spokeswoman Kari DePhillips said in an email.