Is retail going to the ‘doges’ with cryptocurrency?
More U.S. retailers are accepting cryptocurrencies for payment, and one brand has even taken to hyping one of the more fringe of the financial products — prompting many to ask if cryptocurrencies will fill a valuable role or create a volatile mess.
U.S. consumers are becoming more comfortable with cryptocurrencies, according to a Harris Poll reported on in Forbes, with three in 10 of Americans calling cryptocurrencies the future of money. Forty-four percent of Americans would be interested in receiving loyalty program rewards in the form of cryptocurrency rather than as cash rewards.
Starbucks now allows customers to convert bitcoin to rewards balances through an app called Bakkt. Whole Foods, Ulta, Nordstrom and Crate & Barrel have partnered with an app called Spedn, which allows users to shop with bitcoin.
These retailers join others like Subway, which has been allowing bitcoin purchases at some select locations since 2013.
U.S. brands have been engaging the cryptocurrency world in other ways as well. In April, Slim Jim started promoting dogecoin, a cryptocurrency created in 2013 as a parody of bitcoin, as part of its social media strategy, according to Coindesk. After sharing dogecoin-related memes, Slim Jim’s Twitter followers increased by 160 percent and experienced a spike in impressions and an uptick in engagements.
Much of dogecoin’s increase in value between January and last week was attributed to the attention Elon Musk brought to it through his social media presence, according to CNBC. The coin increased 12,000 percent in value in the first four months of the year.
More recent developments, however, draw attention to the potential dangers of cryptocurrency, and the potential to leave inexperienced or unlucky speculators in ruins. All of the major cryptocurrencies, including dogecoin, plummeted in value last week.
There are other hazards as well. The Internal Revenue Service is moving to increase regulations on cryptocurrencies over concerns that they are facilitating illegal activity, including tax evasion, CNBC reported.
- Retailers Are Accepting Crypto. Should Loyalty Programs Be Next? – Forbes
- Much Wow: Slim Jim Has a Dogecoin Strategy. News of It Sends DOGE to a New ATH – Coindesk
- Dogecoin up 12,000% since January — here’s how much money you’d have if you invested $1,000 at the beginning of 2021 – CNBC
- Bitcoin crash opens door to a tax loophole for investors – CNBC
- U.S. Treasury calls for stricter cryptocurrency compliance with IRS, says they pose tax evasion risk – CNBC
- Using Bitcoin to buy a sandwich could trigger a tax bill – CNBC
DISCUSSION QUESTIONS: Should retailers accept cryptocurrencies as payment? What do you see as the potential upside and downside to doing so?