App creator urges Hong Kong's coffee lovers to wake up to bitcoin

The value of bitcoin may have slumped, but one US start-up is betting on the digital currency after developing an app for Hong Kong's coffee drinkers that will allow them to pay at Starbucks with it.

The app, called Fold, is offering a 20 per cent discount to customers paying in bitcoin at the coffee chain. Starbucks is the first major global retailer where bitcoin can be used in-store.

The app works through stored-value payment cards such as Octopus, which can be synced with the user's account on the app.

Matt Luongo, founder and chief executive of the firm that built the app, said he hoped it would provide a turning point after bitcoin's troubled past.

"I hope [Starbucks use] helps raise awareness. Bitcoin needs to erase its past," Luongo said. "People see it as a scam and speculation, but I'm looking forward to showing them how to get cheaper groceries."

Luongo said the Starbucks discount was a bid to "drive more usage" because "bitcoin is difficult to use" without an incentive.

Michael Chau Chiu-lung, an associate professor at the University of Hong Kong's faculty of business and economics, said any move to allow bitcoin to be spent was "helpful".