Bermuda Becomes First Gov't to Accept Tax Payments in USDC Stablecoin

Published on by Cointele | Published on

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Global financial services company Circle announced that Bermuda became the first government to accept its stablecoin USD Coin for tax payments.

Part of a broader government initiative to embrace stablecoinsAccording to a press release shared with Cointelegraph on Oct. 16, this development is part of a broader initiative, which sees the Bermuda government support "The use of USD-dollar backed stablecoins and decentralized finance protocols and services."

"Bermuda's Premier made a broader announcement today about embracing stablecoins as the future of the financial system, with a focus on innovations in fintech that can deliver value not just for Bermudians, but also globally via company's licensed under their Digital Asset Business Act.".

Allaire also explained that Bermuda's economy already relies on a United States dollar-backed currency, namely the Bermudian dollar.

Because of this, he believes that "It's natural that they would both embrace USD-backed stablecoins for their own government services."

He also claims that this Bermuda's initiative highlights that the world is on its path towards mainstream acceptance of stablecoins for everyday payments and commerce.

A comprehensive regulatory crypto frameworkCircle also announced that the firm has been awarded a "Class F" license under Bermuda's Digital Assets Business Act of 2018.

The company claims that this license makes the company the first major cryptocurrency exchange and wallet service ever to receive such a permit.

"Through the DABA, Bermuda is one of the first countries in the world to create a comprehensive regulatory framework for digital currency and digital asset-based products and services, including licensing of firms operating payment systems using stablecoins. It will be interesting to see how other governments will respond to this fundamental innovation."

As Cointelegraph recently reported, Coinbase now allows holders of USDC to earn a 1.25% annual percentage yield.