Finance

Bitcoin ATM Prompts Massachusetts to Warn Consumers

March 20, 2014
 

Massachusetts regulators issued a strongly worded warning Tuesday about the risks of the virtual currency known as bitcoin after the opening of the second ATM-like kiosk in the Boston area that make it easier for people to buy it.

The warning, from the Office of Consumer Affairs and Business Regulation, urged consumers “to proceed with caution” because bitcoin and other so-called crypto-currencies can fluctuate wildly in value, saddling buyers with sudden large losses, and are vulnerable to hacking — as was the case in the collapse of one of the largest bitcoin exchanges, Mt. Gox.

“First and foremost, if you can’t afford to lose the money you have, you should not buy bitcoins,” state officials said in their advisory.

On Monday, the second bitcoin ATM in Massachusetts — and apparently just the fourth in the country — opened at the Clover Food Lab restaurant in Harvard Square. The company that installed and operates the machine, Liberty Teller of Boston, placed its first kiosk at South Station in Boston in February.

The machines allow buyers to deposit cash and get bitcoins that are stored in a digital wallet, the transactions managed by thousands of computers linked in a worldwide network.

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