Bitcoin Accepted at Local Businesses in Lugano
In the picturesque Swiss city of Lugano, a customer at McDonald’s, located by a serene lake, inquires, “Can I pay with bitcoin?” The staff member responds by presenting a terminal that resembles a standard credit card reader, but is designed for cryptocurrency transactions. This innovative payment technology has been provided at no cost to local businesses by the city council. The customer completes the transaction via contactless payment directly from his bitcoin wallet, with the total amounting to 0.00008629 bitcoin, approximately $8.80 (£6.60). While many bitcoin investors view the cryptocurrency primarily as a speculative asset, Lugano is pioneering its use as a medium of exchange.
A Growing Trend in Lugano
In this Italian-speaking region of Switzerland, a shift is taking place. Along with the traditional Swiss franc, around 350 local shops and restaurants now accept bitcoin. The municipal government has also embraced this trend, allowing residents to pay for services, such as preschool childcare, using cryptocurrency. Nicolas, a customer from France, expresses his enthusiasm for bitcoin payments, stating that it offers a sense of freedom from traditional financial systems, which often involve intermediaries and additional fees. He mentions the availability of bitcoin prepaid cards in Switzerland, which can be loaded with funds in Swiss francs and converted into bitcoin for spending.
Local Business Perspectives on Bitcoin
As I stroll through Lugano’s upscale shopping district, I meet Cherubino Fry, the owner of Vintage Nassa, a store that sells both new and pre-owned luxury bags and watches. Fry has chosen to accept bitcoin due to its lower transaction fees compared to credit cards; typically, bitcoin fees are under 1%, while credit and debit card fees can reach as high as 3.4%. However, Fry admits that bitcoin transactions are not frequent yet, noting that the adoption will gradually increase over time. “It’s like a tree growing, and it will flourish in five to ten years,” he predicts.
Plan B Initiative Aims to Promote Bitcoin
Close to Fry’s store, I visit the Plan B headquarters, launched in 2022, in partnership with the cryptocurrency platform Tether. The initiative aims to educate the public about cryptocurrency and establish Lugano as Europe’s bitcoin hub. Mir Liponi, the director of Plan B, recounts a personal experience where she relied solely on bitcoin for 11 days due to banking issues. She found that, aside from public transportation and fuel, most goods and services could be obtained using bitcoin, even groceries were deliverable. Liponi envisions a future where local economies flourish on a bitcoin-based system, allowing residents to earn, save, and spend the cryptocurrency.
Challenges in Bitcoin Adoption
Despite Lugano’s efforts, other initiatives have faced hurdles. For instance, in 2021, El Salvador adopted bitcoin as legal tender, offering citizens a $30 bitcoin incentive. However, many simply converted the bitcoin to dollars and ceased using the cryptocurrency. Vincent Charles from Unchain Data observed this trend during a visit and noted the lack of genuine bitcoin usage among retailers and consumers. Yet, success stories exist; Ljubljana in Slovenia has been recognized as the most crypto-friendly city, followed by Hong Kong and Zurich.
Mixed Reactions to Cryptocurrency
Not everyone in Lugano is enthusiastic about bitcoin. In a lakeside park, a statue representing Satoshi Nakamoto, the mysterious figure behind bitcoin’s creation, was recently vandalized and discarded into the lake. Lucia, a local resident, finds this act intriguing given the generally peaceful nature of the city. She expresses her skepticism toward cryptocurrencies, associating them with crime and instability, especially in light of the significant losses some investors have experienced.
Economic Risks of Bitcoin
Sergio Rossi, an economics professor at the University of Fribourg, warns that bitcoin’s volatility poses risks for shop owners. He advises them to immediately convert bitcoin earnings to stable currencies, such as Swiss francs or euros. Rossi also emphasizes the reputational risks associated with cryptocurrencies, particularly concerning their use in illegal activities. He cautions that if a digital wallet service fails, individuals could lose their assets indefinitely, unlike traditional bank deposits in Switzerland, which are guaranteed up to 100,000 Swiss francs ($125,000; £94,000).
City Officials Remain Optimistic
When questioned about potential criminal activities linked to bitcoin, Lugano’s Mayor Michele Foletti dismisses such concerns. He argues that both fiat and bitcoin can be used for good or bad purposes, asserting that cash is often the preferred method for illicit transactions. Foletti remains optimistic about bitcoin’s role in Lugano’s economy, noting that 110 crypto-sector companies have either relocated to or established themselves in the city.
