Coinstar, the maker of kiosks that turn loose change into cash and gift cards, has partnered with cryptocurrency ATM startup Coinme to let users buy bitcoin.
As part of the partnership, Coinstar invested an undisclosed sum in Coinme.
The companies did not say how many of the Coinstar’s 20,000 kiosks would allow bitcoin purchases. Users won’t have the satisfaction of turning a physical coin into a virtual one: bitcoin can only be purchased with cash, up to a limit of $2,500.
In exchange for cash, Coinstar will provide a code that can be redeemed on Coinme’s website.
The new service comes at a time when bitcoin is in the dumps.
Bitcoin’s value dropped more than 70% last year, trading volume on major exchanges has plummeted, and the market for initial coin offerings has dried up.
“People are moving away from gambling on the future price of digital currency and instead are leveraging digital currencies for their inherent technological advantages thanks to blockchain technology,” Bergquist told CBNN in an email.
Coinme, which launched in 2014, said that the Coinstar investment brings its total funding to $4.5 million. It earns money through transaction fees and a cryptocurrency advisory service for customers with larger transactions.
Genesis Coin and General Bytes operate the most ATMs, with more than 1,000 locations each.
Bergquist said that Coinme’s ATMs have seen increased use during the latest bitcoin “winter.”
“Our customers are leveraging bitcoin as a medium of exchange for remittances, a diversified store of value for their portfolio, or simply as a gift for that ‘crypto-curious’ family member,” he said.
Founded in 1991, Coinstar was previously owned by Outerwall, which was acquired by Apollo Global Management in 2016.
Apollo split Outerwall’s three core businesses — Coinstar, Redbox, ecoATM — into separate enterprises.
Coinstar continues to add new capabilities to its kiosks. Last year it announced an integration with Seattle startup doxo that lets people pay bills at the kiosks and also added Amazon Cash deposit capability.