NEW YORK–Life is like a box of bitcoin. Or at least it is now for diners at certain restaurants, including Bubba Gump Shrimp, Morton's The Steakhouse, and the Rainforest Café, where patrons will soon have the option to earn bitcoin every time they order a meal or a drink.
But one tax expert is cautioning payment by bitcoin can also trigger a capital gains event.
Restaurant giant Landry's is partnering up with crypto custody firm NYDIG to power a bitcoin loyalty rewards program at its 500 locations nationwide, according to CNBC. Diners earn a point for every dollar spent, with 250 points translating to a reward of $25 worth of bitcoin.
Bitcoin touched a new all-time high of over $68,500 recently and is up nearly 350% from a year ago.
Way to Expose People to Bitcoin
"Many Americans don't own bitcoin yet, because they haven't been comfortable going to an exchange and creating an account or they're not sure about investing their money," said Patrick Sells, chief innovation officer at NYDIG, in a statement. "And now they're able to just say, 'Hey, let me get exposure by dining at a restaurant that I love, or trying a restaurant maybe I haven't been to,'" continued Sells.
Landry's told CNBC the objective is to go live with the new bitcoin program before Thanksgiving. It will be available to the 3.2 million members of Landry's loyalty program, Landry's Select Club.
"This is a wonderful way to play without really putting anything at risk," said Trey Zeluff, director of digital asset strategy at Landry's, told CNBC.
Zeluff told the news outlet the program is designed in part to help customers "gain comfort with the volatility" of bitcoin by watching their points grow and fall in purchasing power.
"With our legacy point system, their value was static, and in the context of inflation, they could even depreciate," continued Zeluff.
Landry's is also making a personal bet on bitcoin.
The company plans to hold a portion of its treasury reserves in bitcoin through NYDIG, though the company wouldn't share how much it plans to invest, CNBC reported.
A Note of Caution
CNBC added that people choosing to transact in any cryptocurrency should exercise caution, according to accountants. The Internal Revenue Service treats virtual currencies like bitcoin as property, meaning that spending bitcoin is considered the same as selling it.
"The one thing that a lot of people don't realize is that whenever you spend cryptocurrencies to buy a cup of coffee, or any type of consumer item, that triggers a capital gains event," Shehan Chandrasekera, a CPA and head of tax strategy at CoinTracker.io told CNBC.