Why Compliance Is the Biggest Team at Bitcoin ATM Startup Coinsource

We caught up with bitcoin ATM startup Coinsource on the show floor of the Consumer Electronics Show (CES) in Las Vegas.

AccessTimeIconJan 13, 2020 at 7:30 p.m. UTC
Updated May 9, 2023 at 3:05 a.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global event for everything crypto, blockchain and Web3.Register Now

Coinsource, a well-known bitcoin ATM company, purchased a booth at this year's Consumer Electronics Show (CES) in Las Vegas. Given increased interest from the IRS in bitcoin ATMs, we were especially curious about how users reacted when Coinsource increased its know-your-customer (KYC) requirements.

  • Aptos' APT Token Down 52% in April After Booming March: VanEck
    Aptos' APT Token Down 52% in April After Booming March: VanEck
  • Key Events You Shouldn't Miss at Consensus 2024
    Key Events You Shouldn't Miss at Consensus 2024
  • What to Expect From Consensus 2024
    What to Expect From Consensus 2024
  • Will Solana and Altcoins Dominate the Market Next?
    Will Solana and Altcoins Dominate the Market Next?
  • "Our compliance department is actually the largest department in our entire company," Coinsource's Derek Muhney told CoinDesk in the video above. Money-laundering concerns have long dogged the bitcoin ATM sector.

    Muhney said Coinsource moved to require KYC of everyone two years ago, though the company had always required it for transactions over $800.   

    "We received little to no customer feedback [about the change]," Muhney said.

    At the show, Coinsource was demoing one of its buy-only machines, where a user can use cash to buy bitcoin. The company also has machines that will dispense cash in exchange for bitcoin.

    Coinsource ATMs take an 11 percent fee on any transaction. So that consumers know what they’re getting, Muhney said the company doesn’t try to make money off a spread, or the difference between the prices at which Coinsource buys and sells BTC. (It’s a transparency-boosting move that Square’s Cash App recently undertook as well.)

    Coinsource is currently only offering bitcoin but Muhney said its software has been built to handle more cryptocurrencies. The company currently has more than 400 bitcoin ATMs deployed in 42 states.

    “We really wanted to show off the fact that bitcoin adoption is on the rise,” Muhney said of his company’s presence at CES 2020. “The footprint of bitcoin ATMs on a global scale just continues to grow and grow.”

    As for reactions from people on the floor, Muhney said that booth visitors were “excited to see that it's become so mainstream that they're seeing it at the Consumer Electronics Show."


    Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

    CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

    Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.