Bermuda Starts Accepting Tax Payments in Circle’s USDC Stablecoin

Circle, the international financial services firm, stated that Bermuda turned out to be the first government to adopt its stable coin, which is USD Coin (USDC) to settle tax liability.

The initiative is one among the plan, which involves Bermuda government’s support for “the use of USD-dollar backed stablecoins and decentralized finance protocols and services.”

Regarding Bermuda’s decision to adopt stablecoins in the future, Circle co-founder and CEO Jeremy Allaire said:

“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 pointed out that Bermuda’s economy already depends on Bermudian dollar, which itself is US dollar backed currency. Therefore, Allaire trusts that “it’s natural that they would both embrace USD-backed stablecoins for their own government services.”

He also asserts that the step taken by Bermuda signals that the world is moving towards adoption of stablecoins for day-to-day payments and commerce.

Circle also stated that the firm has been issued a “Class F” license under Bermuda’s Digital Assets Business Act (DABA) of 2018. Notably, Circle has become the first well known cryptocurrency exchange and wallet service provider to receive such a license.

Allaire commented:

“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.”

USDC was unveiled almost a year ago by Circle in collaboration with top cryptocurrency exchange Coinbase. Notably, the exchange permits USDC holders to earn annual interest of 1.25%.