You can’t feel it, and it’s not official, but bitcoin is paying off

● Boobs, bail and booze. That’s what digital currency bitcoin can buy you, among scores of other goods and services in South Africa.

Consumers are able to make and receive payments in bitcoin by using electronic platforms such as PayFast.

“In South Africa, the word ‘currency’ is not defined in the Income Tax Act. Cryptocurrencies are neither official South African tender nor widely used and accepted in South Africa as a medium of payment or exchange,” according to the SARS.

“Cryptocurrencies are not regarded by SARS as a currency for income tax purposes or capital gains tax. Instead, cryptocurrencies are regarded by SARS as assets of an intangible nature.”

While South Africans are still trying on bitcoin for size, some doctors, lawyers, online stores and entertainment establishments are accepting the cryptocurrency as payment.

Plastic surgeon Dirk Lazarus has been paid with bitcoin for breast surgery he performed recently. Breast implants cost about R40 000.

“I think it will be popular in the future as it is better, more secure and ultimately will be faster and cheaper than using our banks,” he said.

He may be the first plastic surgeon in South Africa to go the bitcoin route.

“I don’t know of others and I can’t speak for all of them,” he said.

“I gave a talk on bitcoin at one of our meetings this year and it seems that most people have only a very rudimentary understanding of it.”

Criminal lawyer Ella Pieters has given her clients the option to pay her for services rendered, such as “after-hours bail” and “criminal defence before and in court”, with the cryptocurrency.

“I’m not sure what the Law Society’s stance would be on it. I’ve put it there because this is new ground and somebody has to take the jump.

“It’s unconventional and a bit controversial. As attorneys we have trust accounts for clients’ money. In terms of work that clients pay a deposit for, it will go into the trust account for safe keeping. The bitcoin option would be paying for services already rendered like bail applications,” said Pieters.

Bitcoin has even brought electricity — albeit for a short period — to a Soweto school through a crowdfunding initiative.

A Johannesburg-based blockchain startup, Bankymoon, set up a smart-meter programme to accept digital currency as payment for electricity at Emaweni Primary School in Soweto.

In 2016 Bankymoon demonstrated to the MIT Enterprise Forum of Cambridge how it could successfully merge electricity smart meters with blockchain technology.

“Our aim is to allow hundreds of schools throughout South Africa and the African continent to be able to roll out renewable energy infrastructure.

“All this will be possible because of the bitcoin system we have created,” said Lorien

Gamaroff, Bankymoon’s CEO.

“There is a lot of innovation involved in the project, most of which I cannot yet reveal.

“Suffice to say that the payment flows will be done using bitcoin.

“This allows access to a global market of donors and investors. The infrastructure plan uses solar energy, with the smart meters being one aspect.”

Honingklip Brewery in the Western Cape and the Alexander Bar, Cafe and Theatre in Cape Town accept bitcoin.

“For us it is a talking point at the brewery. Our Honingklip Blonde beer — R25 — is now 0.00023 bitcoin,” said the brewery’s Analize ter Morshuizen.

Nicholas Spagnoletti, one of the founders of the Alexander Bar, said a few patrons had been using bitcoin regularly at the establishment.

Luno, a UK cryptocurrency company that has hubs in Singapore and South Africa, has integrated with many local businesses to enable shoppers to make and receive payments in bitcoin.

“As with most new technologies, it follows along a line of evolution and we expect the use for payments to grow as more people own cryptocurrencies,” said Marius Reitz, country manager of Luno South

Africa.

SARS said in a statement that it would “continue to apply normal income tax rules to cryptocurrencies and will expect affected taxpayers to declare cryptocurrency gains or losses as part of their taxable income”.

It added: “A growing number of proponents support its use as an alternative currency that can pay for goods and services much like conventional currencies.”

Reitz said he believed the mainstream retailers would eventually accept bitcoin payments.

It’s unconventional and controversial Ella Pieters

An attorney who accepts bitcoin as payment