A store decided to issue a prepaid card that can be loaded with cryptocurrency and used only in that store.

Will the customers pay tax when they load the card, use it, or both?

I am interested in US law.

  • Does "charge the card" in this case mean "load the card"? This seems more appropriate for the personal finance stack. Commented Jan 24, 2023 at 15:41
  • 2
    I’m voting to close this question because it is more of a personal finance question. Commented Jan 24, 2023 at 15:42
  • @JustinCave, I updated the question. Please review it again Commented Jan 24, 2023 at 16:57
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    This seems to be the same question (though much better written) that you posted on the personal finance stack recently money.stackexchange.com/questions/154859/… The answer you got there appears to give you what you're looking for. If customers are exchanging dollars for bitcoin, loading the card would not be taxable. But the customer would need to track their cost basis so that they could calculate gain & loss for the subsequent transactions where bitcoin was exchanged for goods. Commented Jan 24, 2023 at 17:03
  • @JustinCave tnx, it wasn't clear for me before Commented Jan 24, 2023 at 17:22

1 Answer 1


Acquiring cryptocurrency in any form, including on a prepaid card, is not a taxable event.

Whether income taxes are due when it is used depends upon the value of the cryptocurrency in question when the card is used. Of course, sales taxes would also often be due at some fixed percentage of the purchase price when using the card.

If the cryptocurrency goes up in value between acquiring it and using it, that is a capital gain. If it goes down in value between acquiring it and using it, that is a capital loss.

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