Bermuda Aims to Make Digital Assets Part of Everyday Financial Infrastructure

Bermuda says it is set to become “the world’s first fully onchain national economy” with the help of stablecoin issuer Circle and cryptocurrency exchange Coinbase.

This initiative aims to make digital assets a part of the country’s everyday financial infrastructure, according to a Monday (Jan. 19) press release.

It will build on an existing partnership in which the Government of Bermuda, Circle and Coinbase helped Bermudian businesses begin accepting digital payments and financial institutions expand their use of stablecoins and tokenized finance, the release said.

Now, the government and the two digital finance companies will help government agencies begin piloting stablecoin-based payments, financial institutions integrate tokenization tools, and residents increase their digital literacy, per the release.

“With the support of Circle and Coinbase, two of the world’s most trusted digital finance companies, we are accelerating our vision to enable digital finance at the national level,” Bermuda Premier David Burt said in the release. “This initiative is about creating opportunity, lowering costs and ensuring Bermudians benefit from the future of finance.”

Circle and Coinbase will provide digital asset infrastructure and enterprise tools, and will support digital finance education and technical onboarding, according to the release.

The initiative will include the use of the USDC stablecoin, the release said. Issued by Circle, USDC is backed by U.S. dollars.

Circle and Coinbase were among the first global firms licensed under Bermuda’s digital asset framework introduced in 2018 through the Digital Asset Business Act, per the release.

Jeremy Allaire, co-founder, chairman and CEO of Circle, said in the release that Bermuda’s expanded use of USDC and onchain infrastructure will empower people and businesses.

“Bermuda has been a global pioneer in digital asset regulation and continues to demonstrate what responsible blockchain innovation looks like at a national scale,” Allaire said.

Coinbase CEO Brian Armstrong said in the release: “Bermuda’s leadership shows what’s possible when clear rules are paired with strong public-private collaboration.”

Bermuda announced in 2019 that it had begun accepting U.S. dollar-backed digital currencies for the payment of government taxes, fees and services.

In July 2021, Allaire said Circle was expanding its operations in Bermuda and opening an office there to support corporate treasury demand for crypto assets and yield.

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