Edit (2017-09-03 at 6:30 pm): Thanks to a user’s comment, I now realize that I may be in the wrong. RockitCoin may have in fact informed me of their exchange rate before I inserted my money. I simply misunderstood their quote because it did not seem plausible (it was higher that Bitcoin’s all time high to date). Please see the comments for this discussion.
I was excited to find a bitcoin ATM (it was also a Litecoin ATM). Compared to the fiat ATM in the same store, the RockitCoin ATM looked slick and modern.
Traditional ATM (ugly, but fair)
RockitCoin ATM (beautiful, but a cheater)
Unfortunately, RockitCoin cannot be trusted and will cheat you out of your money. Read on to learn about my experience and what they charged me.
Before I went to RockitCoin’s ATM, I attempted to do some research. Disappointingly, neither RockitCoin’s website nor its FAQ section (which was not even hosted on their own website) made mention of what fees would be involved in buying Bitcoin via their ATMs or what rate they will provide me. So I headed out for the nearest one.
Know Your Customer (e.g. KYC, not anonymous)
Not that it was a big deal, but the RockitCoin ATM did require me to provide it a mobile phone number, a barcode scan of my driver’s license, and my Bitcoin wallet address before I could even learn about its process or what fees it will charge me. Already, I felt a little violated of privacy before I was yet even a customer. Here were the steps.
Terms and Conditions of Service
Fiat ATM’s don’t have a terms of service, but RockitCoin does. You have to go to their website to read RockitCoin’s Terms of Service (8,422 words or 54,417 characters).
Enter and Verify Phone Number
I didn’t take a picture, but they required me to enter my mobile number. I then received a SMS code that I had to enter to verify my mobile number.
Scan my ID
I use Google Voice, which RockitCoin did not like. They next required me to scan the back of my driver’s license, which included a bar code.
Create a PIN
Next I had to create a PIN — akin to a traditional ATM.
Select a coin
I could select either Bitcoin or Litecoin.
Provide Wallet Address
I scanned a wallet QR code from one of my mobile app wallets.
I still do not know RockitCoin’s fees or rates
At this point, I’ve done a lot of steps and revealed some personal information — yet I still don’t know what their fees or rates will be. Without fees or an exchange rate, I’m still uncertain if I will want to do business with them.
- I agreed to a terms of service the machine didn’t even show me (had to visit their website)
- I provided RockitCoin my mobile number and verified it
- I provided RockitCoin my driver’s license information
- I provided RockitCoin my Bitcoin wallet address
- and I still don’t know RockitCoin’s fee or RockitCoin’s rate
RockitCoin fee of $2 to $3 dollars
Finally, I get to a screen that tells me what RockitCoin’s fee will be. It reads “Due to the small size of your transaction, an additional $3 processing fee applies.”
I wanted to deposit $100. At this point, I’m in agreement and am willing to insert $100 in fiat (USD) in exchange for $97 in Bitcoin. A three percent fee is about what Coinbase would charge me for a $100 credit card transaction. Assuming they give me a fair conversion rate — which still is not referenced — I agree to these terms.
Insert Bills Now (before knowing the exchange rate)
Before I insert $100 in USD bills, my expectation is that RockitCoin will charge me $3 to deposit $97 of Bitcoin to my wallet.
Yet, “You can buy BTC” is still sitting at “BTC 0.00000000”. It appears that the only way to know what exchange rate RockitCoin will charge me for BTC is to begin inserting US dollars.
My assumption was that if I did not like the rate, I would still have the opportunity to click the red X in the top right-hand corner to cancel the exchange and return my $100. I’ve already canceled the process several times up to this point — each time returning to the main screen.
You inserted $100 USD, but will receive only $88 USD in BTC
So I enter $100 in fiat. RockitCoin then revealed it’s BTC/USD exchange rate by offering me 0.01877314 BTC (a value of only $88.01 USD).
Three things happened after I inserted US dollars.
- the RockitCoin fee decreased from $3 to $2 (nice)
- the red X in the top right corner disappeared for the first time (concerned)
- I’m finally provided RocketCoin’s exchange rate for BTC/USD (an unfair exchange rate)
The RockitCoin ATM offered me 0.00018773 BTC per 1 USD when Coinbase was offering 0.00021404 BTC per 1 USD at the exact same time. RockitCoin’s BTC/USD exchange rate was 12.3 percent less than the going rate. Here’s what Coinbase quoted me while standing in front of RockitCoin’s ATM.
Kraken and Bitfinex offered very similar rates as what Coinbase was quoting. RockitCoin’s quote was way off.
To make matters worse, now that I finally knew what RockitCoin was going to charge me (after providing the machine money), there was no way to cancel. The red X was gone. My only option was to Finish my now unwanted transaction.
Swindled by RockitCoin
The RockitCoin ATM cheated me out of my money by a) waiting to provide me its BTC/USD exchange rate after I inserted my money and b) removing the ability to decline or cancel the transaction if I disagreed with their quote.
RockitCoin gave me the false sense of security that I could cancel at any time because every screen before inserting my money (including the screen instructing me to insert money) had a red X and offered me the ability to cancel. It was not until they received an held my money captive did they provide me an unfair exchange rate and remove my ability to cancel.
RockitCoin has created an unnecessarily deceitful process with their ATM’s in what appears to be an intentional means of swindling their customers from their money. Unlike traditional ATMs that state “You will be charged a $3.00 fee” before beginning the withdrawal process, RockitCoin waits to reveal their true cost until the very end — and then removes the ability for the customer to cancel.
There are several things RockitCoin could have done to be both transparent and fair:
- list your fees and exchange rate on your website
- list your fees and exchange rate on your machine before taking any personal information
- provide your customers the ability to cancel at any time, even after inserting money (just give it back)
But RockitCoin did none of this. Instead, RockitCoin devised a process to take my money even if I did not agree to their fees and/or exchange rate. Same on you RockitCoin.
If you’d like to make this right, improve your process so that your customers are informed and are treated fairly.