The government of Bermuda has announced that it will now accept cryptocurrency for tax payments. In addition to taxes, Bermuda’s 65,000 residents will be able to pay for fees and other government services using USD Coin (USDC).
The USD-backed stablecoin is pegged 1:1 with the US dollar. It was developed by the Coinbase-backed CENTRE Consortium and crypto fintech Circle.
According to the announcement, Circle is leading a growing trend that sees governments exploring cryptocurrencies and government-backed digital assets.
“Recent months have brought more and more attention to stablecoins and national fiat digital currency initiatives. While future projects such as Libra seek to introduce entirely new global currencies, and major national governments such as China seek to introduce their own Central Bank Digital Currencies, the broader crypto ecosystem continues to push ahead by building on existing, working public blockchains, and supporting major existing global currencies such as the US dollar.”
Premier David Burt made the announcement on Wednesday, elevating cryptocurrencies to a new status as an integral part of society and Bermuda’s economy
Today, I announced the @BdaGovernment has committed to accept for payment of government taxes, fees and services, 1:1 US dollar backed digital currencies that get licensed by the Bermuda Monetary Authority. That means access & lower costs to financial services for #Bermudians. pic.twitter.com/xrmjfabmjx
— Premier David Burt (@BermudaPremier) October 16, 2019
The Ethereum-based USDC is used in a variety of decentralized finance products and consumer services, including products for savings, lending, borrowing, securities offerings and trade finance.
Earlier this year, Circle’s crypto exchange Poloniex shifted the majority of its employees to crypto-friendly Bermuda amidst regulatory uncertainty in the US.