In a McDonald's by a lake surrounded by mountains, in the centre of the Swiss city of Lugano, a customer orders coffee.

"Can I pay with bitcoin?" he asks, and the person behind the counter holds out what looks like a credit card payment terminal.

It is in fact a machine for paying by crypto currency. The equipment has been distributed free to local retail businesses by the city council.

The buyer pays by contactless, from the bitcoin wallet on his mobile phone. The bill comes to 0.00008629, which is roughly $8.80 (£6.60).

Few people who have bought bitcoin would probably think about using it to purchase actual things in shops. It is instead generally seen as an investment, a bet on its value going up.

But in Lugano, in the Italian-speaking part of Switzerland, it's a different story.

While you can of course still pay for everything in Swiss francs, some 350 shops and restaurants now also accept bitcoin. The local authority has even started taking payments in crypto currency for municipal services. You can, for example, pay for pre-school childcare in bitcoin.

I get talking to the McDonald's customer, Nicolas, who comes from France. He is what you might call a bitcoin true believer.

"What's great about paying in bitcoin is the feeling of freedom it gives you," he says. "You are no longer dependant on a financial system with its middlemen and its costs."

Nicolas says he's discovered bitcoin cards in Switzerland. These are prepaid gift cards. You buy a certain sum in Swiss francs but download it in bitcoin onto a digital wallet on your phone.

I walk through the centre of Lugano, down a high street where just about all the shops sell luxury stuff. Jewellery or expensive clothes mainly.

In a shop called Vintage Nassa that sells new and second-hand bags and watches, the owner Cherubino Fry tells me he accepts bitcoin because the processing fee he has to pay per transaction is less than those charged by credit card........

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