For both purchasing digital currency - and selling it where our machine supports two-way transactions - CoinMover uses CoinMarketCap.com as a rate source to form the foundation of our pricing.
We make our purchases through multiple major crypto exchanges, which are then turned around and sold to you, so it makes the most sense to use CoinMarketCap as the base rate. It's an average of all major exchanges that do business in the United States such as Gemini, Kraken, Binance.US, and Coinbase.
Each transaction at a CoinMover ATM comes with a fixed-price USD transaction fee that ranges from $0.99 to $4.00. As of April 2020, we are charging $2.75. We attempt to explain the various costs and fees involved with transacting digital currency below. This set fee is generally the amount necessary to move funds from our exchange accounts to our hot wallets, and then to your personal wallet when buying and the same in reverse when selling.
In addition to this flat fee, we also add the following:
On top of the base market price provided by CoinMarketCap.com explained above, we add a fixed 10.0% to 14.0% markup rate for all digital currency purchases. That means you are buying digital currency at a rate that is higher than the market rates on CoinMarketCap.com. The reasons for this markup are explained in the FAQ below.
For sell transactions, where you sell your digital currency back to CoinMover from your own wallet and withdraw cash from our machine, we charge between 0% and 4.0% above the current market rate. As of April 2020, this is set at 0.9%. The reason the sell rate is slower lower than the buy rate is the transaction doesn't have to make its way back into the traditional banking system and incur those additional costs. Again, see below for an explanation.
That's crazy! Why are fees high?
ATM operational costs include the many yearly and monthly costs CoinMover must pay to make our services available to our customers. In addition to the tens of thousands of dollars in equipment costs, these include recurring monthly expenses as well.
The manufacturer of our machines takes a cut of all transactions right off the top on a percentage basis.
We also have to pay each retail location monthly space rental ranging from $150/mo to $1,000/mo depending on location, hours, foot traffic, etc.
There is also regular maintenance and insurance costs for our network of machines.
Add in monthly cellular data connections (Verizon primary with T-Mobile as a fail-over) for each machine. Monthly cloud hosted back-end application services required to make it all work. Website hosting costs. Automated text messaging service provider costs so you can get notified on your phone or via e-mail about transactions. Support ticketing software licensing that tracks issues end-to-end if you have problems and need to reach out to have them resolved.
... they all add up little by little. 1.25% here, 0.75% there, etc.
The money you insert into a CoinMover ATM is picked up regularly by an armored vehicle service like those Brinks trucks you see driving around. After performing their standard route each day, very much like FedEx or UPS, they end up at a bunch of banks, making individual cash deposits to corporate vaults. This service is priced and charged to CoinMover as a percentage of the cash picked up and deposited by the armored car service.
In addition our corporate bank charges us cash deposit fees of approx. 0.5% per $100 of cash deposited. This is a cost of doing business levied by our banks for conducting high volume cash transactions on a regular basis.
The deposited money must then be wired to cryptocurrency exchange(s) to be held in anticipation of future orders and purchases. On top of transaction fees for corporate accounts, banks charge even more fees for recurring wire transfers – as much as $40 per wire transfer.
Banks also charge companies like us extra because we are a "Money Service Business" (MSB). You might pay a $10 or $15 monthly charge for your checking account. We pay hundreds of dollars per month in base account charges, plus additional fees for compliance related reviews.
Next, the wired money is used to purchase cryptocurrency on an exchange -- Kraken. Each trade has various fees for different types of requests (market, limit, stop) and they charge a percentage of each order for the market priced orders we execute.
Once the cryptocurrency is purchased, it isn’t really useful just sitting on the exchange. It needs to be withdrawn to a digital hot wallet that funds the next batch of CoinMover ATM transactions.
Each withdrawal from the crypto exchange has a set fee for each transaction. We try to limit the volume of withdrawals but sometimes we need to keep withdrawing because our customers keep buying all the time. It's a vicious circle. 🙂
The cryptocurrency market can be all over the place. One minute BTC is up $100, and the next minute it is down $100. In periods where the market is moving consistently upwards, we make more money. No complaints here!
However, in times when the market is running downwards -- even for just a single day -- we may be selling you cryptocurrency for less money than it might have cost us to purchase it in the days prior.
We must bake a percentage into the price to hedge against that inherent risk and make sure that, at the very least, we aren't losing money on each transaction. That's just how business works and we hope you understand.
Blockchain mining fees are what make digital currency complex and calculating them is even more complicated than bank or exchange fees. Mining fees vary in amount but are typically based on demand, network congestion, and digital transaction size – not necessarily dollar amount.
There have been scenarios like December 2017 when mining fees were more than the amount of money being moved at times. These mining fees are charged when CoinMover sends the cryptocurrency to your wallet.
We're at the mercy of the blockchain network (BTC, LTC, ETH, DASH, or XMR) to pay fees according to entire network volume at the time you perform a transaction.
Many question why prices at digital currency ATMs are so high. Sure, we mark up the price of the crypto you buy. Yes, of course, we make some money from you.
At the moment, nobody is getting rich off this type of business. It's more about increasing adoption and giving access to crypto to more individuals who otherwise wouldn't be able.
We hope the items above help explain the process isn't as easy as everyone thinks. Our goal is more volume = fewer costs and fees. As we find shortcuts or better ways to complete the circle of cash-to-crypto and crypto-to-cash, we will always try to pass them along to our customers.
High volume buyers are also eligible for discounts as described below. Please feel free to e-mail us at [email protected] with any questions. We'll answer as quickly and as honestly as possible.
Fee Discounts, Loyalty Program, and Promotional Codes
CoinMover offers every registered and verified account the ability to participate in our loyalty program that will reduce fees paid over time. These may included, but are not limited to, removal of the $1.75 USD per transaction fees and/or discounts on our markup rate.
From time to time, CoinMover may run promotions on our website or in local communities with discount codes that allow you, as a user of our services, to receive fee discounts.
Once you have reached certain thresholds of purchases, sales, or combined amounts, you will receive enrollment information along with additional program details. These are also available from us on request.