Government Initiative to Integrate Digital Asset Infrastructure
Bermuda's government has initiated a comprehensive plan to integrate digital asset infrastructure across its national economy through collaborations with cryptocurrency exchange Coinbase and stablecoin issuer Circle. The program targets government operations, financial institutions, businesses, and consumers with blockchain-based payment systems and educational resources.
Premier E. David Burt presented the framework Monday at the World Economic Forum in Davos, Switzerland. The companies will deploy digital asset tools to government agencies, banks, insurance providers, and small businesses while establishing training programs to support technical adoption across the island's population.
Foundation and Rationale for the On-Chain Economy
Partnership discussions originated at the Bermuda Digital Finance Forum in May 2025. The on-chain economy model positions digital assets as core financial infrastructure rather than supplementary technology, addressing structural cost challenges facing island jurisdictions.
Payment processing expenses create particular burdens for Bermuda, according to government statements. Geographic classification alongside Caribbean territories produces elevated fees and restricted access to mainland financial services, compressing profit margins for merchants operating on the island.
Role of USDC and Existing Regulatory Framework
Circle's USDC stablecoin will serve as a primary transaction medium under the initiative. The dollar-pegged token enables merchants to process payments with reduced costs and settlement times compared to traditional card networks, though the announcement did not identify specific businesses currently accepting digital currency.
The program expands Bermuda's existing digital asset regulatory framework established through the 2018 Digital Asset Business Act. That legislation created comprehensive licensing requirements for crypto businesses, with Circle and Coinbase securing early approval to operate under the regime.
Past Pilots and Future Implementation
The government, Coinbase, and Circle distributed 100 USDC to each participant at last year's Digital Finance Forum for spending at participating local merchants. Additional businesses have incorporated digital payment acceptance since that pilot program, while financial institutions have expanded stablecoin usage and explored asset tokenization applications.
Government departments will test stablecoin payment processing as part of the national rollout. Banks will implement tokenization capabilities for traditional assets while residents access education programs designed to build familiarity with digital wallets and blockchain transaction mechanics.
Expected Economic Benefits and Flexibility
Expected economic benefits include reduced transaction costs and improved access to international financial markets through digital infrastructure. The framework aims to retain more economic activity within Bermuda's borders rather than losing value to offshore payment intermediaries.
A source familiar with the arrangement confirmed the partnerships remain non-exclusive, allowing Bermuda to engage additional technology providers. The on-chain economy represents a voluntary direction rather than mandated adoption, leaving businesses and residents free to maintain traditional financial relationships.
Coinbase's Stablecoin Solutions
Coinbase separately introduced its Custom Stablecoins product, allowing enterprises to launch branded stablecoins backed by USDC and other dollar-denominated tokens without constructing proprietary infrastructure. The company reported that stablecoins facilitated $9 trillion in transaction volume throughout 2025.