Three young entrepreneurs have opened what they call the world’s first ATM able to exchange bitcoins for any official currency.

The machine inaugurated Tuesday, delivered to Vancouver in Western Canada by Robocoin, an American manufacturer, stands against a wall of a popular coffee shop, and resembles an ordinary cash ATM.

However, instead of cash transactions it swaps Canadian dollars for bitcoins, the virtual currency of the Internet invented in 2008 by an anonymous computer scientist known only by the pseudonym Satoshi Nakamoto.

Customers lined up Tuesday to use the ATM, then used their smart phones to buy coffee and muffins at the Waves coffee shop.

The ATM is the world’s first, said co-owner Mitchel Demeter, a local entrepreneur who started trading in bitcoins several years ago, then earlier this year with two partners set up Bitcoiniacs, a Vancouver storefront money exchange.

He and his friends, who were high school students together, said they saw ATMs as a business opportunity. “Nobody had an ATM, everyone was buying and selling on websites,” said Demeter.

Customers use a private key – like a bank PIN number – to access their online account of bitcoins on the ATM.

They withdraw cash equivalents (the conversion rate is currently about one bitcoin for $200) from their bitcoins, or deposit cash bills. The machine transfers the money on the Internet via the Canadian VirtEx exchange.

Users can then spend their bitcoins with a smartphone, in a similar way to the way interact or credit cards are used, or by transferring the money to purchase goods online. see more

source: rawstory