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Bitcoin ATMs ready to spread through North American cities

After debuting last year in Vancouver, Canada, Robocoin's bitcoin ATMs are set to go online this week in Austin, Texas with other locations in the United States, Canada, and Asia to follow, the startup said Wednesday.

The Robocoin ATM at Austin's HandleBar will be fired up at 2 pm Central Time on Thursday, making it the company's first bitcoin-converting cash dispenser in the United States. Also this week, Bitcoin Asia said it expects to receive several Robocoin ATMs for deployment around Seoul, South Korea following a government-regulated certification process.

"We're thrilled to bring Robocoin to the US and help more Americans buy and sell bitcoin," Robocoin CEO Jordan Kelley, pictured below right, said in a statement. "Austin is one of the coolest cities in the world. It's a tech hub and we're excited to launch a month before South by Southwest. Austin is also geographically centralised — right at America's 50-yard line. It's a perfect starting point for the USA as we start placing machines everywhere.

Bitcoin is an open-source P2P digital currency introduced in 2009 by developer Satoshi Nakamoto. It operates with no central bank or authority, and is "created" by users on their own computers with a "miner" application.

It also has no defined legal status or monetary equivalent. Trading local, legal tender for bitcoin, as done by operators of ATMs made by Robocoin and others, would appear to be a risky, speculative process with no legal mechanisms in place to adjudicate disputes.

Operating a bitcoin ATM may be risky but it comes with the chance of high rewards, as well.

The Vancouver ATM, which launched last 29 October at Waves Coffee Shop, topped $1 million (£598,000) in transaction volume in its first month of operation, according to Robocoin.

It's not clear how different Robocoin ATM operators will choose to charge users for the use of their machines, but the Waves machine reportedly rakes in a 5 per cent commission on individual transactions. Robocoin customers like Bitcoin Asia are happy to get in on that kind of action.

"We are excited to introduce the Bitcoin ATM to the most tech-savvy market in the world. Bitcoin is attracting public attention in Korea, and we want to take the Bitcoin awareness in Korea to the next level by adding a simple way to purchase and sell Bitcoin," said BitcoinAsia executive Jewoo Yeom.

Kelley said the Austin launch was the opening act in a "Robocoin World Tour" that will also see ATMs shipped to and launched in Seattle and Alberta, Canada. The Robocoin chief said Austin was selected for the commercial debut of his company's ATMs in the U.S. because "bitcoin was born for Texas."

"Texas is the Lone Star State—a natural launchpad for bitcoin, the currency of freedom and independence. Bitcoin is democracy's biggest invention since the Internet," he said.

Robocoin anticipates shipping more than 40 ATMs to locations around the world in February and March.

Bitcoin ATMs have been in the works for some time. Lamassu demonstrated a prototype bitcoin ATM last February and showcased a production model of the machine in May. BitAccess is another maker of bitcoin ATMs competing with Robocoin. Machines exchanging local currency for bitcoin are reportedly shipping to numerous locations around the globe.

But bitcoin is not without controversy—lots of it. Speculators have taken the price of the virtual currency on roller-coaster rides in the past, spammers have targeted bitcoin wallets, the Chinese government banned banks from accepting it, Apple recently pulled a bitcoin app from its App Store, and the founder of the BitInstant exchange was arrested last month for allegedly aiding the Silk Road black market site.

There are also security concerns about bitcoin. An administrator of a reincarnated version of the busted Silk Road site said last week that the online black market's bitcoin account was hacked and currency valued at $2.7 million (£1.62 million) stolen.

Robocoin claims its ATMs are hardened with security systems and software that incorporate "biometric authentication, government ID scan, and human verified facial matching" to prevent identity theft, with more measures in place to prevent people from using the machines for money laundering.