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Cashpoints Drop, Merchants Rise: How Bitcoin’s Real World Usage Changed Over the Last Year

Last Updated January 8, 2024 11:55 AM
James Morales
Last Updated January 8, 2024 11:55 AM

Key Takeaways

  • In 2023, the number of locations around the world accepting Bitcoin payments nearly tripled.
  • Merchants have especially embraced the Lightning Network, which makes small-value BTC payments more affordable.
  • Meanwhile, there was an overall decrease in the number of Bitcoin ATMs.

Since Satoshi Nakamoto published the Bitcoin white paper 15 years ago, the way people use the technology has evolved, often in unexpected directions. Nonetheless, their original vision for Bitcoin as a form of electronic cash remains central to its usage today.

Amid changing consumer and business preferences, in 2023, the number of merchants accepting BTC increased significantly. But at the same time, the number of Bitcoin ATMs declined, reversing the trend for growth observed every year previously.

Merchants Embrace Bitcoin Lightning Payments

According to data collated by BTC Map , in the year to January 8, the number of physical locations where customers can pay with Bitcoin rose 277%. The rise in merchants accepting payments via the Bitcoin Lightning Network was even more pronounced, increasing by 291% throughout the year.

While BTC Map reveals businesses around the world have embraced Bitcoin, acceptance is most concentrated in Europe and the Americas. 

In South America, Argentina has emerged as a hotspot for Bitcoin payments in the past year.  With many in the country turning to crypto as a way to protect themselves from high inflation, more 200 Argentine businesses now accept BTC.  Meanwhile, hundreds of merchants in Brazil, Colombia and Venezuela are also riding the continent’s crypto adoption wave.

Retail Adoption Surges in Latin America

To make transacting as simple as possible, South American merchants and consumers have turned to retail-friendly Bitcoin payment solutions. David Bailey, Chief Marketing Officer at Azteco, told CCN there has been “a real upswing in interest and purchases from that part of the world.”

Azteco’s Bitcoin vouchers let people who don’t have a bank account purchase crypto. 

Bailey argued that, in places like the US or the UK, “we have the luxury of looking at something like Bitcoin as a long-term store of value”. But in many parts of the world, “it solves a real problem for people who don’t have electronic banking facilities”.

Expanding the point, he observed that demand for Lightning vouchers grew throughout 2023. Combined with the prevalence of QR-based payment systems in the region, Bailey noted that the Bitcoin Lightning Network is increasingly enabling smaller-value Bitcoin transactions.

With more and more businesses accepting even small denominations of Bitcoin, spending crypto without swapping it for fiat currency is an increasingly viable option. But what does that mean for Bitcoin ATMs? Do they have a future in a world where most merchants accept crypto?

Bitcoin Cashpoints Decline in 2023

For anyone possessing Bitcoin who needs quick access to fiat currency, special cashpoints let users deposit crypto to withdraw cash. Many also work the other way around, letting users buy Bitcoin with cash deposits.

Since the first Bitcoin ATM was opened in a Vancouver coffee shop in 2013, more than 30,000 have been installed in locations around the world. However, in 2023, the number of machines declined for the first time. This suggests their expansion may have run out of steam.

number of bitcoin atms
  The number of bitcoin ATMs declined in 2023.

After climbing continuously for nearly a decade, the number of Bitcoin cashpoints  peaked at over 39,000 in 2022 but has fallen by around 6,000 since. 

While it isn’t clear exactly what’s behind the trend, fears over their potential use for money laundering have motivated regulations world wide. Bitcoin ATMs are banned in a number of countries, including Thailand, Vietnam and Russia.

Meanwhile, in 2023, the UK’s Financial Conduct Authority (FCA) embarked on a major crackdown  on the machines. Pointing out that it hasn’t licensed any companies to operate crypto ATMs, the regulator has moved to shut down dozens of machines in the past 12 months.

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