Romit, the remittance service, which earlier started as Bitcoin ATM manufacturer Robocoin, announced it is closing all its Bitcoin related services with effect from February 15th 2016.
The company now seems to have moved on to more traditional forms of payments for its entire business.
What could have been the motivation of Robocoin to close all its Bitcoin related services entirely? Did they have to close because of their own incompetency? Or Is the BTM business not beneficial anymore? Cointelegraph conducted a survey of experts from the Bitcoin ATM market.
Their own doing?
Robocoin was one of the first entrants in the business of Bitcoin ATM manufacturing. Did they have to close their business because it was not sustainable anymore because of their own shortcomings? Most industry experts believe that this is the case.
Peter Trcek, CEO of Bitnik says:
“They did not give out full control of the machine, had extremely expensive (and impractical) hardware and wanted to retain a portion of operator's profit. Their business model was risky and it now failed. It's their own business decisions and attitude towards operators that caused their downfall.”
Eric Grill, CEO of CoinOutlet also believes that fault lies with Robocoin itself:
“Robocoin machines were never very well received by the community, the unfair contracts they made the operator's sign with them was pushed onto the customer in extra fees not to mention the exorbitant pricing structure.”
BTMs not Profitable Anymore?
Another reason why Robocoin had to close its Bitcoin services could be because the entire market for BTMs is not profitable anymore.
Michael Dupree, founder of Easybit, thinks it is a two way street. As per him, it is a difficult business but profit is possible.
“It’s not really about a profit model it's more about logistics and compliance at this point. Profit is possible, though many are unsuccessful due to poor management, etc. Those trying to make a quick buck aren’t doing the ecosystem any good - and likely won’t go very far.”
Henry Brade, CEO of Bittiraha, said:
“Bitcoin ATM business is certainly profitable but it depends on a lot of factors. Some manufacturers are certainly struggling because it's difficult to find a pricing model that works for the operator and works for the manufacturer long term.”
He further explained that regulation issues are a big factor, for example due to heavy regulation there are basically almost no BTMs in Sweden or Estonia but in Finland they are more than a dozen and the market is very competitive.
Any Effect on the Market?
Most industry experts do not believe that it will have any negative effects on the market.
Peter Trcek says, 2 years ago, the closing down of Robocoin might have had an impact on the BTM market, but not so today. As per him, Robocoin's failure will have a similar impact on the BTM space as Nokia's downfall did on the smartphone space.
Tone Vays believes that, “The cryptocurrency market could not care less. The sooner inefficient companies disappear to make room for competent companies to take their place there”.
Michael Dupree added, “This reflect positively on the bitcoin ecosystem. As quickly as robocoin is leaving there are new manufacturers popping up every day, some such as Genesis Coin provide a far superior product with far superior support.”
However Henry Brade believed that from an operator’s point of view it is a big problem if a manufacturer goes bankrupt. He said “Lots of operators rely on the manufacturer for support, maintenance, updates etc. So this would negatively affect the reliability of BTMs.”