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Will that be debit, credit or Bitcoin?

Would you like to pay for your morning coffee with your credit card or your bitcoin wallet?

If San Francisco-based start-up Shift Payments has its way, you'll soon be able to switch from real money to digital currency when paying with a single card.

Tara Moore | Taxi | Getty Images

The company is beta testing 100 cards with friends and family members. It allows users to make purchases with accounts from Coinbase—a bitcoin exchange—and Ripple—a digital payment exchange protocol that can support real and digital currency.

While the card does not currently access bank or credit accounts (just bitcoin accounts for now), co-founder Meg Nakamura says Shift Payments is trying to make that happen soon.

"We are having conversations with U.S. banks to see if we can get them comfortable," she said. "They are very, very interested. It's just a timing issue. So we are building out the product with the partners we have right now."

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Users download a mobile app with the card, which they use to switch between currencies and accounts. The company takes a small percentage of each transaction.

"We modeled this after Coin," said Nakamura, referring to the digital payment card that consolidates multiple credit cards into one Bluetooth device. "We really like this gadget and hope to be able to work with it, but we don't have that hardware right now so we're doing it with a mobile app. It's the software solution to what could become hardware."

Nakamura hopes the company will become valuable to banks in addition to spenders.

"Unlocking this value is interesting for the banks because it means more transactions for them," Nakamura said.

Read MoreEbay in talks to accept bitcoin

There are obstacles, though. Various high-profile data breaches could temper potential enthusiasm for small, untested payment companies, said Gil Luria, analyst with Wedbush Securities.

"The main risk associated with this type of service is that you have to trust your money with the service provider, in this case Shift, which is often a small and unproven company," Luria said.

Add to that challenge that the average card carrier doesn't yet use bitcoin, much less understand it.

That said, bitcoin is gaining in popularity. "The adoption of cryptocurrency is happening at a very rapid rate," Luria said.

"There are more than 5 million bitcoin wallet users, up from less than 1 million a year ago. This is especially impressive since this is not a free messaging app. All 5 million of these people have moved actual money into these accounts."

Luria said this is a faster rate of adoption than online banking or online brokerage ever experienced despite the big names behind them. Shift Payments, he says, is bridging the gap between the digital currency world and traditional payment infrastructure for early adopters.

Still, it seems counterintuitive to want a physical product to represent your digital currency.

"Nothing is as familiar as swiping a card," said Sean Safahi, co-founder of ZipZap and founder of a soon-to-be announced bitcoin product. "You'll see more of these types of relationships as the currency gains recognition."

Shift Payments also aims to add loyalty points as a currency on the card, allowing customers to pay with points they've racked up with favorite retailers.

Read More Bring us your gripes about bitcoin: CFPB

"Of all the loyalty points in the U.S., one-third of them go unused," Nakamura said. "So what if you could spend all of those points at an existing point of sale? Bitcoin is just one of those stores of value. Although we are leading with bitcoin right now, we are thinking a lot more generally about all of this value you have every day."

—By Natali Morris, special to CNBC.com

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