Venmo, the peer-to-peer personal payment app, announced Tuesday it will be expanding its platform into cryptocurrency.
The launch of crypto on Venmo means that the app’s 70 million plus users will be able to buy, hold, and sell cryptocurrency directly within the Venmo app, according to a press release on the company’s website.
Similar Bitcoin wallets already exist in the marketplace, but Venmo’s appeal will be its integration to buy, sell, and trade Bitcoin, Ethereum, Litecoin, and Bitcoin Cash using funds from personal Venmo balances or linked bank or debit card accounts, with purchases as little as $1.
“Our goal is to provide our customers with an easy-to-use platform that simplifies the process of buying and selling cryptocurrencies and demystifies some of the common questions and misconceptions that consumers may have," Darrell Esch, Venmo’s SVP and GM, said in a press release.
Since cryptocurrencies hit the scene, they have been lauded as a way to skirt foreign currency exchange rates, international money wire fees, payment processing fees, and delays associated with money transfers. But for all of crypto’s capabilities to modernize payment and currency, its widespread adoption hinges on being used as payment for goods or services by retailers, businesses, and service providers.
So where can you spend your cryptocurrency? Yahoo Money rounded up U.S. merchants and stores that gladly accept it as tender and third-party merchants that can convert your crypto into cash or cash equivalent, so you can spend your Bitcoin at a Starbucks in a circuitous way.
How to convert cryptocurrencies to gift cards
Spending a digital currency in a physical store, restaurant, or hotel requires a workaround.
Platforms like Bitrefill, Coingate, eGifter, and Gyft make it possible to purchase gift cards to a variety of major retailers like Amazon, Delta Airlines, IHOP, Target, and The Home Depot using Bitcoin converted into U.S. dollar amounts, generally at a discount.
Where can you spend your Bitcoin?
AT&T carries the distinction of being the first major U.S. mobile carrier to accept cryptocurrency as a payment method.
Cheapair.com allows customers to book and pay for flights and hotels using Bitcoin.
The Dallas Mavericks NBA team has been an early adopter of cryptocurrency payment and has accepted Bitcoin as payment for game tickets and merchandise through the team’s website for almost two years. The franchise recently added Dogecoin as a payment capability for fans to use.
The Miami Dolphins NFL team announced Litecoin as the franchise’s official cryptocurrency and fans at home games can pay with Litecoin and Bitcoin when purchasing tickets for the team’s 50/50 raffle.
Online electronics retailer Newegg recently announced it will accept Dogecoin in addition to Bitcoin.
U.S. e-retailer Overstock has partnered with Coinbase to allow Bitcoin payments for online orders.
Select products in Tesla’s inventory of electric vehicles and solar panels can be purchased with Bitcoin.
Richard Branson, the billionaire entrepreneur behind Virgin Mobile, Virgin Airlines, and Virgin Galactic, announced to CNBC in 2013 that Virgin Galactic will accept Bitcoin as payment for space travel.
Donations can be made to The Wikimedia Foundation, Inc., the charitable organization that hosts Wikipedia, using Bitcoin and Ether.
How to use cryptocurrency wallets
An all-digital currency still needs its own wallet and several companies like Exodus, Mycelium, and Electrum have digital wallets with intuitive interfaces for users to buy, sell, and trade their cryptocurrencies.
Certain apps like Bakkt give users the ability to spend their crypto on things besides more crypto and convert their asset into Starbucks card money, or hotel and flight reservations through Choice Hotels.
How is cryptocurrency taxed?
Making a purchase using cryptocurrency does feel like the harbinger of the future, but it also can come with tax implications. In the eyes of the IRS, virtual currencies are classified as property rather than currency.
According to the IRS, if you exchange a cryptocurrency “held as a capital asset” for other property — including goods or another crypto — or use it to pay for a service, you will recognize a capital gain or loss.
Whether it’s a short-term gain or a long-term one depends on how long you held the cryptocurrency. If you held it for one year or less, then you have a short-term capital gain or loss. If you held it for more than one year, then you have a long-term capital gain or loss.