Circle and Coinbase have partnered with the Government of Bermuda to help the island nation go “fully onchain” by providing the digital infrastructure needed to support a nationwide transition to blockchain-based finance.
Key Initiative Details
The initiative was announced during the World Economic Forum annual meeting in Davos, Switzerland. It is centered on equipping the Government of Bermuda, local banks, insurers, small and medium-sized businesses, and consumers with the proper tools for digital finance. As a part of this initiative, both Circle and Coinbase plan to support digital finance education and onboard local residents and institutions to new payment systems utilizing blockchain technology.
Bermuda’s Economy to Benefit
According to the announcement, this initiative is expected to significantly support Bermuda’s “highly entrepreneurial economy,” which hosts thousands of local businesses. Historically, being grouped with Caribbean and other island jurisdictions has led to increased fees and limited access to onshore payment processors, thereby squeezing already thin merchant margins.
The adoption of alternative payment systems, such as Circle’s USDC, is anticipated to enable “fast, low-cost, dollar-denominated payments.” Transitioning to an on-chain economy is also expected to unlock further tangible benefits, including reducing reliance on traditional intermediaries, enhancing access to global capital, and ensuring more economic value circulates within the island.
“This initiative is about creating opportunity, lowering costs, and ensuring Bermudians benefit from the future of finance,” stated Hon. E. David Burt, JP, MP, Premier of Bermuda.
Under the plan, government agencies are expected to begin piloting stablecoin-based payments, while financial institutions will integrate tokenization tools. Residents will participate in nationwide digital literacy programs. While an exact timeline for full-scale implementation was not provided, some local businesses have already started accepting digital payments following a USDC airdrop event last year.
Bermuda’s Pro-Crypto Regulatory Approach
Bermuda has demonstrated a consistent commitment to digital assets, establishing the Digital Asset Business Act in 2018. This legislation has attracted over 40 licensed virtual asset service providers to operate from the island.
Circle was among the first global companies to receive a full Class F DABA license in July 2019 and announced plans last year to expand its tokenized money market operations in Bermuda. Coinbase secured its Class F license in April 2023, establishing an international hub on the island.