Ian Freeman, a member of the Free State Project who hosts a live talk show, says people drive up from Boston, Mass. and New York City since the machine is the only pubic bitcoin machine anywhere in New Hampshire, Massachusetts, Vermont, Maine or New York. Freeman calls the machine a bitcoin vending machine rather than a bitcoin ATM since it accepts dollars but does not dispense them.
The machine, made by Lamassu, sits in front of a former thrift store that has been converted into a shop called 101 Local Goods, 661 Marlborough St. in Keene. Keene has been a hotbed of the libertarian Free State Movement.
The Shire Free Church, for which Freeman says he is the pastor, provided the bitcoin machine for the store. The Shire Free Church is battling Keene in an attempt to be tax-free.
Freeman is disappointed bitcoin has not become more widely used. The number of retail locations that accept it remains small, he said.
There used to be more bitcoin machines operating in the area, including one in Manchester, but the other machines have either been removed or disabled. This is true even in places where bitcoin machines would seem natural, like Cambridge, Mass.
Lamassu has 138 machines operating worldwide, according to Neal Conner, the customer service manager. He said there are customers in over 40 countries. A company that owned machines in the Boston area got a lot of publicity when the machines were new, Conner said, but that company has since moved away from placing machines high-traffic sites to more targeted business nationwide.
Conner said Lamassu is waiting for someone to really seize the opportunity the machines offer. He noted that in some locations, including New York City, the machines are doing very well.
Success factors for the machine are promotion and location, Conner said.
Freeman said bitcoin needs a “killer app” to raise public attention. The value of bitcoin is not obvious to many people unless they are attracted to bitcoin’s anti-government philosophy or are interested in investing in bitcoin as a speculative venture.
Websites are currently offering discounts on Amazon and Starbucks purchases, Freeman said. He said the discounts could be offered because they reduce transaction costs for retailers in comparison to transaction costs banks and credit cards charge retailers.
The lack of bitcoin machines is also due to technical issues from a certain company (not Lamassu) and regulatory challenges like one in New York State that dismantled machines in Buffalo, N.Y. and Syracuse, N.Y. and even one in Burlington, Vt., Freeman said.
Cost is also an issue. A new Lamassu machine costs around $6,500, Freeman said.
The machine in Keene generates a 5 percent commission on its sales, with 1 percent going to the store, 1 percent as a transaction fee and 1 percent for technical and server costs, Freeman noted during a Facebook exchange. The machine grossed $10,000 in October, meaning $200 covered the cost of the machine.
Freeman said the financial performance was not bad since he bought the machine used.
The machine’s transactions are available on the blockchain.info website using the machine’s bitcoin address, 1FCNJLtDd1RovtFtQmuhA1xyF5cCoNYx2H.
Recent transactions for the machine have been as high as five bitcoins, currently worth about $1,650, and as small as four one-hundredths of a bitcoin, about $13.
Featured image from Shutterstock, additional images from the Free State Project and Flickr.