Beginning this past Monday, Switchyard Brewing Co. — located in the growing college town of Bloomington just a few blocks from the Indiana University Campus — began accepting Bitcoin cryptocurrency in its downtown taproom for all orders.
“At Switchyard, we have always worked to challenge the status quo and the perceptions of traditional business. The developers, miners, and adopters of cryptocurrency are exactly the same. Adopting alternative payment options that don’t involve high transaction fees or a centralized processor aligns with the craft brewing industry’s mantra of damn-the-man ethos,” said Kurtis Cummings, chief executive officer. “I’ve always been a self-proclaimed advocate of unconventional and innovative views on business and leadership. This launch is just an extension of that.”
Before the COVID-19 pandemic, the brewery’s average guest check was around $12 or about the cost of two beers. The brewery’s downtown taproom now includes its own Switchyard Pizza Kitchen, which the company opened in 2020 due to the COVID-19 pandemic.
“Our guest check now averages over double that amount since the addition of our pizza kitchen,” said Kiley Memmott, hospitality director. “Exacerbated by the pandemic, almost no one uses cash anymore. Digital currencies are the primary method of payment in our taproom.”
“Since switching to a tip-free business model last fall, customers do not even have to sign for their credit card tabs anymore,” said Cummings. “A key benefit to accepting cryptocurrency is eliminating the credit card fees, which unfortunately get factored into the pricing whether customers realize it or not.”
With traditional credit card purchases, fees may be up to 3.5% per transaction — with payments made in Bitcoin, those fees would plummet to less than 4-tenths of a percent Launching its own self-hosted cryptocurrency node, Switchyard implemented the open-source technology from BTCPay Server, which provides a secure, private, censorship-resistant and free payment processor.
“We even went as far as naming one of our team members CCO, or chief crypto officer, of the company,” said Cummings. “One of our original coworkers, who is also an engineer by trade, really brought the idea to life.”
Michael McClung, who works part-time at the brewery, was an early adopter in cryptocurrency and provided the team with the blueprint for how to adapt the up-and-coming technology to the brick-and-mortar concept.
“Cryptocurrency is still in its infancy. I would say we at Switchyard are still very early adopters of the technology,” said McClung. “The self-hosted node that we have implemented at Switchyard will allow us to not only support payment processing for our own transactions, but we will also be able to help support other local small-businesses or charities who may want to begin accepting cryptocurrency. Since the server contains the entire Bitcoin blockchain, transactions are not only instantaneous but are also secure. When businesses depend on a third-party payment processor, not only do they charge fees, but customer data is frequently sold to third parties. With cryptocurrency, the transaction needs no middleman and customer data remains private.”
“With Switchyard’s investment into the implementation of our local Bitcoin node, we are able to support our community by easily helping other small businesses adapt and integrate Bitcoin payments into their own point of sale or online store,” said Cummings.
Customers will still be able to use fiat currency (U.S. Dollar) and credit cards at the bar, but if they want to use their cryptocurrency wallet, it’s as simple as scanning a QR code. The customer will need to use a digital wallet, such as Coinbase Wallet, to scan the QR code generated by the bartender when they are ready to pay. The transaction is settled immediately and customers are provided with a receipt.
Cummings referenced the organization’s guiding principles. “We are excited to be the first to adopt this technology; but we are more excited about what the future holds and helping other progressive-minded companies adopt the technology too. Our mission has always been to be a catalyst for positive change within our community. We do this through our guiding principles, two of which, a place to learn and ‘being an active part of our community, being dead center to our organization’s adaptation of cryptocurrency.”
[…] against the potential financial benefits from accepting cryptocurrency for customer purchases. Accepting cryptocurrency for customer transactions instead of credit cards allows brewers and other businesses to avoid the credit card fees incurred […]