Chris Yim dropped out of the Wharton School at the University of Pennsylvania in 2013 to launch what would become LibertyX, the first U.S. bitcoin ATM startup, with fellow Wharton student Kyle Powers.

Though it no longer operates the ATM-style kiosks that are flourishing here, LibertyX has grown to become the largest retail bitcoin exchange in the nation. Yim said LibertyX has 19,000 outlets in brick-and-mortar stores, where customers can instantly buy the cryptocurrency. In an email interview, Yim discussed the company's beginnings, its evolution, and how customers use LibertyX services.

Question: What is LibertyX's origin story?

Answer: Kyle and I both got the bitcoin bug the summer prior to starting our MBAs at Wharton. For two finance geeks (formerly in venture capital and private equity), bitcoin was the most interesting innovation we had seen in our lifetime. Everyone thought we were crazy when we dropped out to start LibertyX.

We launched the first bitcoin kiosk in early 2014, in Boston's South Station, and have learned a lot from being first-to-market and evolving with the market. There are regional bitcoin ATM operators that have a few machines here and there, but we are the only retail network with a national scale. Our success is due to our unique offering of convenience, responsive customer support, and instant settlement.

Q: According to the locator, it appears you have about 12 outlets in the Philadelphia area. Is that right? How do you decide where they will be placed?

A: Yes; I do want to point out that we do not offer kiosks anymore. We sold our physical kiosks and moved to an asset-light software model, where stores offer our platform at their existing POS terminals. Our goal is to have LibertyX stores all around the country, so you are never more than a few blocks away.

Q: Who owns the devices?

A: We built our proprietary software platform that lets local stores offer LibertyX as part of their payment services.

Q: Who is the typical LibertyX user? Younger financial technology aficionados? The under-banked? Dark web customers?

A: Men under 35 who have an interest in finance or tech. Also, anyone that would traditionally buy gold.

Q: What are they using them for?

A: Gold 2.0, international transactions, alt-coin trading, esports, instant transactions, e-commerce, ideology, and novelty.

Q: What information does a customer have to provide to use a bitcoin ATM? Does LibertyX ask for more detailed information than other providers?

A: The same information that you would provide when opening a bank account (name, phone number, address, birth date). We take a conservative approach on compliance and ask for more information than most bitcoin ATM operators.

Q: Is it possible to make a LibertyX transaction anonymously?

A: It is not possible to use LibertyX anonymously. Users need to have verified LibertyX accounts before they can make a purchase at one of our stores. The information requested varies depending on how much bitcoin the customer wishes to purchase.

Q: What should people who have never bought bitcoin know about it?

A: Purchasing bitcoin is easier than you think, and you can go from zero to having bitcoin in a few minutes. Another unique aspect of our model is our "bring-your-own-wallet" approach. Some people prefer to use a wallet on their mobile phone, while others prefer to use a desktop or hardware wallet. Our goal is to be as inclusive as possible, so we let the user pick the wallet they want to use; all they need to provide is their bitcoin address.

Q: How do your machines make money for their owners or lessors?

A: Our stores receive a convenience fee per transaction. LibertyX takes a 1.5 percent fee. This is different from bitcoin ATM operators who typically pay stores rent, much like in the traditional ATM model.

Q: Who sets the exchange rate, or transaction fee, for each machine? How do those fees compare with other money transfer options?

A: Our exchange rate is an average rate based off an index of some of the most popular bitcoin exchanges. In general, the fees are a lot lower than you would pay for sending money internationally using Western Union.

Q: What are the advantages to using bitcoin and LibertyX over other money transfer options?

A: A bitcoin transaction is instant, lower cost, and irreversible. An international money transfer that previously would take a week and cost 10 percent can be done in seconds for cheaper.

Q: Any reason to suspect the machines are used for illicit transactions?

A: No.

Q: Why should average consumers consider using bitcoin or LibertyX services?

A: It is a great way to get your feet wet by buying a small number of bitcoin. Unlike other online services that can take over a week for a bank transfer to clear, with LibertyX you can have bitcoin before you leave the store.

Q: Who regulates the devices?

A: We work with both federal and state regulators.

Q: What are the company's revenues and growth rate?

A: We do not publicly disclose our financials, but we have certainly benefited from the increasing public and institutional interest in bitcoin and blockchain.

Q: How does LibertyX rank in size to the other firms in the bitcoin space?

A: We are the largest retail bitcoin exchange in the U.S. Our store network is magnitudes larger than our competitors.

Q: How many employees do you have?

A: We have a team of 12.

Q: What kind of people are you hiring?

A: We are always looking to add passionate individuals who want to help build the future financial system. In particular, we are looking to bring on additional full stack developers and regional sales reps.

Q: How do you foresee the experience changing for the consumer over the next 10 years? How will bitcoin affect us?

A: Bitcoin and blockchain will be used "behind-the-scenes" as the financial plumbing to facilitate financial tasks we perform everyday. There will still be people using bitcoin for its store of value (gold bugs and high-inflation economies). However, the vast majority of consumers won't know they are using the blockchain rail. They will just experience the blockchain-enabled benefits from financial-service providers, including faster money transfers, lower transaction fees, increased transparency, etc.

Q: Were you surprised to see the value of bitcoin take off so astoundingly? Has the rise sparked more interest in LibertyX?

A: We were surprised it didn't happen sooner. We are big believers that public blockchains will play a big role in the future financial system. It is still early.