There are now 285 Bitcoin ATMs around the world

On Friday, I got a PR pitch saying that two companies I'd never heard of, BitcoinATM360 and Coinsetter, are teaming up. BitcoinATM360, as the name implies, sells Bitcoin ATMs — machines that let people convert between Bitcoin and conventional currencies. Coinsetter operates an exchange for trading Bitcoins electronically.

I have no idea whether this particular partnership will be fruitful. But the announcement is a reminder that, despite waning interest from the media, people are still pouring resources into building user-friendly Bitcoin services.

Bitcoin ATMs have emerged as an area of intensive investment. BitcoinATM360 is just one of several companies that are competing to supply Bitcoin ATMs to people around the world. Others include Robocoin, Genesis, and Lamassu.

The first Bitcoin ATM was only launched about a year ago. Today, there are hundreds of Bitcoin ATMs around the world. That means that if you want to send cash from Portland to Bangkok, or from Montreal to Mexico City, you don't have to rely on Western Union or Moneygram. You can convert your dollars to Bitcoins at a local ATM, then send the Bitcoins to the recipient, who can redeem the Bitcoins for cash in their city.

Right now, the value proposition here isn't great. Bitcoin transfers are fast — they clear in less than an hour — but they also have some big drawbacks. You'll pay fees of 3 to 5 percent at each end of the transaction, and you'll have to deal with the complexities of a new and fairly exotic technology. Many cities only have one Bitcoin ATM, if they have any at all, so you might have to drive to reach one.

If you want to send cash from Portland to Bangkok, you don't have to rely on Western Union

But there are two reasons to think the value proposition will improve over time. One is competition. Right now, Bitcoin ATMs can get away with charging 5 percent because there are few if any other Bitcoin ATMs in a given metropolitan area. But the number of Bitcoin ATMs is growing rapidly. As people install more machines, we'll see growing pressure to cut fees. There's every reason to think Bitcoin ATM fees will wind up being dramatically cheaper than the 5 to 8 percent that's often charged by conventional money transfer services.

Bitcoin ATMs should also benefit from network effects: every new ATM that opens increases the value of every other ATM, since it means there are more people around the world who can potentially send or receive Bitcoin transfers.

Of course, there's no guarantee that Bitcoin will eventually become competitive with conventional money-transfer services. Maybe Bitcoin entrepreneurs will never figure out how to make the experience seamless enough for non-techies to trust. Maybe regulatory barriers will prevent Bitcoin ATMs from becoming as ubiquitous as Western Union branches. But right now, a lot of people are betting that these challenges can be overcome.

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