Andrew Lutes was never really into crypto.
He had friends that bought and sold forms of the digital currency, but he had never dabbled in it himself until January 2021. That's when he bought into Dogecoin, a cryptocurrency inspired by an internet meme featuring a Shiba Inu, for a penny before it shot up to eight cents.
"I sold almost all I had thinking I was a genius, only to see it go to like 74 cents later," Lutes said. "But I was excited. I had all of this Dogecoin and thought, 'Man, I'd like to buy some coffee with this,' yet I couldn't find anything online."
That's where the idea for Dogebeans Coffee was born. Lutes called up his business partner, Kelly Fineman, and pitched the idea for a viral marketing campaign on Twitter and Reddit.
Fineman was one of the co-owners behind 78 Coffee Co., a coffee shop at 907 E. Liberty St. in Louisville. It had opened just a few months before the coronavirus pandemic, and the cafe closed during the crisis to focus on its wholesale coffee bean roasting.
Lutes said the intent was to accept cryptocurrency as a form of payment for a bag of coffee beans as a way to get back into retail sales. After some deliberation, they decided to run with it.
"Our popularity took off overnight," Lutes said. "There was a market there... People who had gotten into cryptocurrency were looking for places where they can where they can spend it, and so we got to have that opportunity to be the first coffee subscription that you can purchase with crypto."
Given the rather volatile nature of cryptocurrencies, not many retailers or other businesses have adopted it as a form of payment, and even less will accept anything outside Bitcoin, the original cryptocurrency that has a market cap of $1.17 trillion. For example, Starbucks recently began allowing people to use Bitcoin on its app via Bakkt, but still isn't accepting Bitcoin directly.
The crypto-fueled online sales were doing so well that Lutes and Fineman opted to rebrand 78 Coffee Co. to Dogebeans Coffee. The rebranded cafe just opened its doors on Friday, Nov. 19.
Lutes said the name isn't just about a fun meme. He said they were drawn to the Dogecoin community, where Doge is often used as an acronym meaning "Do Only Good Everyday."
"No pun intended, but it was coined by the creator of Dogecoin Billy Markus, and that really speaks to some of our values," Lutes said. "That's something that we strive to do as a coffee shop. All of our coffee is fair trade and we're looking for ways that we can impact our community in a positive way."
While Dogebeans Coffee accepts other forms of crypto as well, Lutes said Dogecoin is more accessible — priced at just 22 cents per coin as opposed to $57,500+ for a single Bitcoin — making it a little less intimidating for newbies. The shop accepts U.S. dollars as well.
Wait, what is cryptocurrency? Cryptocurrencies are digital or virtual currencies that are based on blockchain technology, according to Investopedia. Unlike traditional currencies like the U.S. Dollar or the Euro, cryptocurrencies are generally not issued by any central authority, rendering them theoretically immune to government interference or manipulation. Fun fact: El Salvador just recently gave Bitcoin the status of legal tender.
Dogebeans Coffee is using a platform called Coinbase Commerce to accept crypto payments, which allows merchants to hold onto its crypto assets and cash them out for U.S. dollars when they need it or when the market is right. It works the same as Square payments, or any other point-of-sale system, Lutes said.
"It is a volatile asset and that's a risk we take," he said. "It's all about risk management and how you're willing to grow with it. We believe in it and we believe in the technology behind it, specifically blockchain and decentralization.
"We love what's happening in this space and we think this is here to stay. We want to position our business in a way where we can take advantage of this market and grow because we're providing people that option to be able to spend their cryptocurrency and use it."
Lutes added that he hopes Dogebeans Coffee serves as a guinea pig of sorts, proving to other Louisville businesses that crypto payments can be a viable option to consider for the future. The cafe also plans to host educational workshops to help people learn more about how crypto works.
"We want to make crypto easy and accessible, just like a cup of coffee," Lutes said. "We want to make this thing not scary."
Dogebeans Coffee's signature coffee is a classic medium roast called "Moon Fuel," reference to the celebratory "To the moon!" phrase used when prices are up, but the internet references don't stop there. It also offers NFTeas and a CODL cold brew, a play on HODL, which in crypto-speak means "hold on for dear life."
For now, the shop is open from 6:30 a.m. to 2 p.m. Monday through Friday and 9 a.m. to noon on Saturday, but those hours may be extended as demand grows.
