Bermuda Becomes First Country To Allow Tax Payment Using USDC Stablecoin

October 17, 2019 / by Crypto.IQ

Financial services firm Circle has announced that Bermuda is the first government to agree to the use of USDC coin for payment of taxes. The financial services company indicated that the initiative would see the government use decentralized protocols and services. The Bermuda government will also allow the use of dollar-backed tokens.

Bermuda citizens can now use USDC stable coin to pay tax

The USDC stablecoin pegged on the US dollar launched last year by Circle and Crypto exchange Coinbase. Since last year up to date, the start-ups have transacted more than $1 billion. Bermuda will be the first nation to accept USDC as a mode of tax payment for its 60,000 citizens. There are also plans to have support for additional decentralized currency protocols besides USDC. According to the press release, there is a bigger plan to integrate crypto tokens into government operations.

Circle CEO and co-founder Jeremy Allaire said that the move by the government of Bermuda was an exciting prospect. With Bermuda embracing crypto tokens in its financial system, this will be a huge win for the company. The CEO said that the economy of the nation relies greatly on a USD backed currency called the Bermudan dollar.  Because of the link, it is natural that the country embraced the USD-backed stablecoins for government operations. Also, Allaire indicated that the initiative shows that soon, the world could see mainstream adoption of cryptocurrencies

Circle announced that they received a Class F permit under the 2018 Bermuda Digital Assets Business Act. With the license, the company becomes the first crypto exchange to receive such a license. Equally, DABA means that Bermuda is among the first countries to have a cryptocurrency regulatory framework. Allaire indicates that they will be watching to see how other states will respond to the developments

Bermuda among the countries regulating cryptocurrencies

On Wednesday, Bermuda also indicated that they were working together with blockchain firm Shyft Network. They have collaborated to unveil a blockchain-based identity program that will help people in conducting business in the country. The country is embracing blockchain technology, and in 2017, it formed a blockchain team with Bermuda Business Development Agency. Because of favorable crypto regulations in Bermuda, in July of this year, Circle transferred its operation to Bermuda.  

Crypto acceptance is growing, and different regions have adopted crypto payments. In November last year, Ohio started accepting taxes in the form of Bitcoin. However, early this month, the succeeding political administration walked back the tax policy allowing payment of tax in BTC in the state.

Other governments, such as China and Marshall Islands, are currently working on state-regulated digital currencies. Circle asserts that governments will soon have to join the growing trends and adopt this amazing innovation.