Dubai received its first cryptocurrency ATM this week and it looked like the country was making a huge step forward with embracing digital currencies. The ATM only allowed crypto purchases, the same that is seen with the majority of crypto ATMs around the world, and didn’t require the presentation of an ID or the completion of any Know Your Customer (KYC) or anti-money laundering (AML) procedures. Those two points may have been the automated teller’s downfall, as it has been removed only two days after it was installed.
The ATM had been installed at the Rixos Premium Dubai JBR hotel and wellness center by crypto ATM distributor Amhora. It announced the new ATM via its Twitter feed on March 19, but it now appears that local regulators didn’t approve of the absence of KYC guidelines and ordered the teller to be removed. Amhora said on Twitter the day after the ATM was installed, “UPDATE: After a brief run-in with the law enforcement yesterday, we have temporarily put-off the ATM from its location. Working closely with the relevant authorities to reinstate it after we fulfill all AML/KYC obligations.”
Amhora is now working with the local authorities to try and allow the ATM to return to the hotel. The removal is expected to only be temporary, provided the company can jump through the requisite hoops.
Among the obstacles are reassurances that the company is licensed by the Department of Economic Development in Dubai. Amhora has claimed that it is, but the forced removal of the machine calls that license into question. The company will also need to include KYC options, similar to those seen in crypto ATMs offered by Lamassu.
Users of the ATM can, if it is allowed again, to pay a commission of about 5%—some crypto ATMs charge as much as 7.5%. Amhora CEO Anhad Dhingra explains, “The commission is very attractive because you can buy bitcoins instantly. Otherwise people have to go through a number of procedures which take a lot of time. At this kiosk, you just insert cash and you get bitcoins instantly. It is possible to purchase bitcoins through banking platforms and debit cards already but since we accept cash, it is very different.”
It’s back to the drawing board for Amhora and Dubai, but hopefully for just a short time. Crypto ATMs continue to find their rightful place across the globe and Dubai has already stated that it is interested in becoming a blockchain hub. For that to happen, it will have to be more open to the technology.
New to blockchain? Check out CoinGeek’s Blockchain for Beginners section, the ultimate resource guide to learn more about blockchain technology.
