Switzerland: How the World's Densest Bitcoin ATM Network is Doing
One month after Switzerland’s national railway company SBB/CFF/FFS surprised everyone by allowing every single one of their ticket machines to sell bitcoin to anyone with a Swiss phone number, we followed up to see how it has been going for SBB and its customers.
At the end of October, the Swiss rail service SBB released a statement that they were to sell bitcoin on their ticket machines in all train stations in Switzerland, effective November 11th. This pilot project is to last for a minimum of two years and is operated by Swiss financial services company Sweepay. To buy bitcoins, the customers only need a phone number and a Bitcoin wallet. The cap is fixed at CHF 500 (EUR 460, USD 500) per transaction. As the SBB ticket machines are now turned into Bitcoin Teller Machines (BTMs), the Swiss BTMs network just became super dense with more than 1000 BTMs working around the clock.
Bitcoin.com tested this feature on the first day. Below are our impressions as well as some users’ feedbacks and an exclusive interview with Sweepay CEO Rodolphe Texier.
Also read: EY Switzerland Accepts Bitcoin and Installs ATM
There are only a few steps to follow to buy bitcoins at the SBB ticket machines. We selected “Other offers,” then “Prepaid,” and “Top up Bitcoin” and we were asked to scan the QR code on our bitcoin wallet. If you experience trouble scanning the QR code, maybe try with another Bitcoin wallet by choosing another one here, and/or try to increase luminosity on your phone’s screen.
When it got scanned, we needed to enter the desired amount to be purchased (any sum between CHF 20 and CHF 500) and confirm the offer received. There was a transaction fee of approximately 6% and also an exchange rate fee, leading to higher costs than what regular BTMs in Switzerland offer. After reviewing the offer, we needed to confirm the transaction by entering the security code (mTAN) we received on our phone via a text message.
Finally, we paid the required amount in CHF: cash or debit card possible, no credit card allowed, though. A few minutes later, we saw the transaction in our wallet and could check on the Bitcoin blockchain that the coins were being successfully transferred to us.
Switzerland Bitcoin ATM Users’ Feedbacks
We asked around in the train station to get feedback from travelers about this unique feature. Fred was not aware of it and said: “I am not sure if I would use it, I bought one bitcoin as an investment once on an exchange but I don’t buy on a regular basis so this is not useful to me, but I can imagine it could be to other people.” We also got the chance to chat online with someone who tried the feature out (the interviewee requested to remain anonymous):
Bitcoin.com (BC): Why did you use the Sweepay/SBB buy bitcoins feature?
A.: To have some spending money on my mobile. I have a stash of bitcoin on (purposefully) hard to access cold storage, so it is not for ‘investment’. For that I would also put more effort into getting a better price. But it is very convenient for filling my phone’s wallet with an amount of BTC that is roughly equivalent to the amount of cash money that I carry in my wallet.
BC: What are the positive aspects of the Sweepay/SBB BTC feature?
A.: They are everywhere. This will not be an advantage to anyone living in Zürich, Geneva or Basel, where you have a choice of low-price BTMs, but I live in Fribourg, and there is nothing here. No BTM, no Mycelium local trader. And I don’t want to connect any of the services to my bank account, so for me the closest would be the BTM in Bern, which has inconvenient opening hours (it’s in a billiard place that only opens at 11:30). So for me it is fine to pay the premium for the SBB ticket machine (for smaller amounts) over taking the trip to Bern.
BC: What are the negative aspects of the Sweepay/SBB BTC feature?
A.: That they require your mobile number, and getting even a prepaid one requires you to present an ID. They require it (as far as I can see) to make sure you stay below a limit every year, which probably eases regulatory issues for them. I am sympathetic to that reason, but in the end it is less private than I would like it to be.
A second major drawback is of course the price. They claim 6% fee, which is not perfect already, but fine. The nearest proper BTM in Bern takes 5%. But the exchange rate is very unfavorable as well. Yesterday around 19:30, they used an exchange rate of 795.37 BTC/CHF. It should have been closer to 774 BTC/CHF, if I am generous. I don’t have the exact time but around that time there was a bump from 769 to 774. So I paid an additional 2.7% on top of the 6% fee.
BC: Do you believe this feature will be used by the mainstream?
A.: I don’t think so. The cities where there are stores that accept BTC are also the cities where there are cheaper BTMs. I appreciate that there is now a widespread offer throughout Switzerland, the price of which of course also serves as an upper bound for other actors like Localbitcoins or “Mycelium local trader” traders, but that’s about it.
BC: What do you think would be the next steps for SBB when it comes to bitcoin?
A.: I don’t think they will accept bitcoin any time soon. In the ticket machines the bitcoin selling option is at the ‘prepaid’ category, next to several options to top up your mobile balance. The SBB is a service provider to Sweepay, because their machines know how to take in money, have a QR scanner and are spread out around Switzerland. SBB does not have any own skin in the game. And if it was a dip-toe-into-water test on how much interest there is in bitcoin from customers, that’s probably a failed experiment. I’d of course love to see numbers from Sweepay, but due to the high price and the somewhat niche market it’s only useful in smaller cities where there’s no BTM, where on the other hand there is also not much demand due to lack of accepting businesses. I’d guess the numbers are pretty low.
Interview With Sweepay CEO
We also got the chance to talk to Sweepay CEO Rodolphe Texier who took the time to share his views on the joint project after a month of existence (in collaboration with SBB representatives).
Bitcoin.com (BC): Could you please elaborate on the joint project a little bit (origins and history, people involved, problems, vision, etc.)?
Rodolphe Texier (RT): Sweepay as a “prepaid value” distributor in Switzerland identified Bitcoin as an eligible prepaid product given the status of Bitcoin in Switzerland from a tax and compliance point of view. Since the distribution of Bitcoin is more suitable from vending machines than at POS, we identified SBB ticketing machines as an excellent channel to expand bitcoin distribution since these machines are already distributing prepaid products like mobile top-ups. Facilitating the acquisition of bitcoin is the primary objective of the service with SBB. The vision is to facilitate and possibly accelerate the adoption of crypto-currencies in Switzerland through existing digital or physical channels.
BC: What are the benefits of the SBB/Sweepay BTC feature?
RT: The size of the network. Almost every Swiss resident is close to a train station. Also, the availability of the network, it’s open 24 hours a day, 7 days a week. Also, the
quality of service, i.e. the reliability of SBB ticketing machines.
BC: What could be seen as negative aspects of the SBB/Sweepay BTC feature?
The service requires a Swiss mobile phone number to purchase bitcoin, which is a “must have” for Sweepay being a financial intermediary, as we’re responsible for the compliance of such a service.
BC: Could you please expand a little bit on the numbers? How many bitcoin transactions have been processed on the SBB ticket machines in a month?
The service meets our expectation in terms of volume and number of transactions so far.
BC: Where are the most successful ticket machines? Large cities or places without regular Bitcoin Teller Machines (BTMs)?
RT: The “Bitcoin traffic” is well distributed all over Switzerland (where SBB ticketing machines are available). This concerns also large cities where BTMs are already available.
BC: Do you believe this Sweepay/SBB feature will be used by the masses in the future?
The aim of the service is to facilitate the acquisition of bitcoin. To be used by the masses a large ecosystem and related services will need to be put in place in Switzerland as well.
BC: What are the next steps for Sweepay when it comes to Bitcoin?
SweePay is working especially on services which could facilitate the use of Bitcoin.
BC: Do you plan to replicate this in some other countries?
Even if our primary focus is Switzerland, we are now looking to expand our Bitcoin services to other countries through strategic partnerships.
Bitcoin.com could not access more specific details about transactions numbers and volumes as it is confidential information. Overall the project seems to work smoothly and is well received by users. It will be interesting to follow this project throughout out the years and also assess if it develops in some additional countries around the world as it can obviously help grow Bitcoin adoption.
What do you think about the Sweepay/SBB “buy bitcoins” feature, have you tried it? Let us know in the comments below.
Images courtesy of Railway Gazette, SBB
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