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Coinme Report Finds Crypto Ownership Increases Blockchain Literacy

Coinme Report Finds Crypto Ownership Increases Blockchain Literacy

In a recent cryptoliteracy.org survey sponsored by Coinme, 28% of U.S. respondents stated they don’t invest in cryptocurrencies because they don’t understand the technology. The survey also found that simply owning a small amount of crypto correlates with a 55.5% higher level of blockchain literacy.

This Catch-22 has long stood in the way of broader adoption of crypto. A basic understanding of the blockchain technology that underlies bitcoin and other crypto assets is a huge driver of adoption, but often even those who are curious will not seek out education on blockchain and crypto if they don’t already hold some digital assets.

On the plus side, the report suggests that as purchasing and using crypto becomes easier for retail investors and the average consumer, crypto literacy will improve. Options like Coinme’s bitcoin ATM network, with thousands of machines situated in well-established retail locations, allow more people to safely access crypto, and the hope is that this leads to more education on the technology’s benefits and use cases.

“Empowering individuals with the knowledge to navigate the evolving landscape of digital currencies is at the core of our mission,” said Neil Bergquist, CEO and co-founder of Coinme, in a statement on the report. “A concerted effort needs to be made to enhance crypto literacy.”

Coinme has been at the vanguard of this educational push, initiating Crypto Literacy Month in 2021. The company’s trajectory, from launching the first state-licensed bitcoin ATM in the U.S. in 2014 to now powering the world’s largest network of bitcoin ATMs, parallels crypto’s rise to mainstream relevance over the past decade.

Bergquist is optimistic that this trajectory, along with the increasing use of other mainstream exchanges, will continue to steer the public toward a greater understanding of crypto.

“I think right now we’re at a stage where there is really an education problem,” he says. “It’s important to try to educate people on how crypto is solving problems that exist with our current monetary system and financial service providers.”

Finding ‘A Trusted Way To Buy’

When Neil Bergquist and Michael Smyers founded Coinme, bitcoin was still a niche concept known primarily to dedicated enthusiasts and speculators, and it was difficult and risky to access.

“Back then, the way you bought bitcoin was you meet a stranger online, go to a coffee shop, give them cash, and that person gives you a USB stick with bitcoin they likely mined on their computer,” says Bergquist. “That’s wholly unregulated, and it’s potentially very dangerous. We wanted to protect customers and offer a trusted way to buy bitcoin.”

In 2014, Berquist and Smyers purchased three bitcoin ATMs. After receiving a virtual currency money transmitter license from the Washington State Dept of Financial Institutions, these ATMs were installed at locations like a local restaurant and a mall in Seattle, a first for the U.S. While public awareness was still minimal at the time, the dramatic 2013 price surge from $214 to over $1,200 signaled that a wider bitcoin boom could be imminent.

Sure enough, 2017 was crypto’s watershed mainstream moment. As bitcoin reached almost $20,000, suddenly everyone wanted in on the action. And Coinme, with its physical ATMs providing an entry point to purchase bitcoin, was perfectly positioned.

Soon, Bergquist and Smyers realized that installing crypto-specific ATMs would be too capital-intensive and wouldn’t be enough to meet the booming demand. Instead, they opted for integrating an API into existing cash machine networks via partnerships.

The pivotal deal came in 2018 when Coinme joined forces with Coinstar, known for its coin-cashing kiosks at grocery stores. By installing its API into Coinstar’s vast network across the U.S., Coinme enabled consumers to purchase bitcoin at familiar retail locations just as easily as inserting a bill into the machine. A partnership with MoneyGram soon followed, and today the company enables cash-to-crypto transactions at over 40,000 physical locations throughout the U.S.

Adoption Through Accessibility

At its core, Coinme is focused on boosting crypto adoption by ensuring accessibility. Its expansion into Coinstar and MoneyGram locations has democratized purchasing bitcoin.

This plug-and-play functionality, coupled with the reassuring familiarity of mainstream retail outlets, lowers the barriers to entry for curious newcomers interested in testing the waters.

“Coinme wants to make the cash-to-crypto buying experience as simple as possible,” Bergquist explained when the company enabled instantaneous crypto purchases with no need for a redemption code via Coinstar kiosks earlier this year. “Now, the purchase is linked directly to the customer’s mobile phone number and loaded into their Coinme wallet all before they leave the grocery store.”

The ability to conduct cash-to-crypto and crypto-to-cash transactions at physical locations is key to boosting widespread adoption. Enabling seamless bitcoin and cryptocurrency liquidations into cash counters a common criticism that crypto has no real-world utility.

“One of the misconceptions is that you can’t buy anything with bitcoin,” says Bergquist. “Well, now you can liquidate your bitcoin for cash and buy anything you want.”

 

The Path Forward

While the 2023 cryptoliteracy.org and Coinme survey results highlighted some concerning gaps in the public’s understanding of crypto and blockchains, Coinme and collaborators like CoinDesk are actively developing educational curricula to increase comprehension. Cryptoliteracy.org provides free courses and quizzes covering everything from basic definitions of crypto terms to more advanced concepts like DeFi and staking.

However, the survey data suggests that nothing accelerates blockchain literacy quite like hands-on participation and crypto ownership itself. By making it virtually effortless for anyone to purchase bitcoin at their local retailers, Coinme is providing an ideal grassroots on-ramp.

“Our mission is to provide more individuals around the world with access to a better financial future via cryptocurrency,” said Bergquist in an announcement of the company’s recent partnership with the CiNKO digital wallet, a collaboration that reaches throughout Latin America and the Caribbean.

As a new generation of consumers holds their first cryptocurrency and explores real-world use cases, comprehension is poised to increase in lockstep with adoption. The crypto literacy gap may persist in the short term, but hands-on education at the ground level, facilitated by the access offered by bitcoin ATMs, could ultimately prove to be a powerful instructor.

 

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