Panama City has approved the use of cryptocurrency for public service payments. Residents can now pay taxes and fines using Bitcoin, Ethereum, USD Coin, and Tether. A partner bank will convert these transactions into U.S. dollars on the spot, maintaining legal compliance. This model allows for the growth of the crypto economy without requiring public institutions to directly manage digital assets, contrasting with El Salvador’s approach.
Panama City has recently approved an innovative measure, enabling its residents to pay for various public services using cryptocurrencies. The city council has voted in favour of accepting Bitcoin (BTC), Ethereum (ETH), USD Coin (USDC), and Tether (USDT) for payments relating to taxes, permits, and fines. This initiative aims to modernise payment methods while ensuring compliance with legal standards.
To facilitate these transactions, a partnership with a banking institution has been established. The chosen bank will convert the cryptocurrencies into U.S. dollars at the point of payment, thereby adhering to legal requirements without necessitating additional legislation. Panama City’s Mayor, Mayer Mizrachi, expressed that this pragmatic approach allows for efficient transactions without the cumbersome need for new laws.
This new payment system affords residents the opportunity to utilise cryptocurrency for everyday transactions involving the government, while guaranteeing that the city receives all payments in its official currency. Furthermore, it fosters the growth of Panama’s crypto economy without placing the burden of digital asset management directly on public institutions.
Unlike El Salvador, which instituted Bitcoin as legal tender in 2021, Panama’s approach remains optional. This model prioritises compatibility with existing financial systems and provides a flexible framework for integrating cryptocurrency into public service payments.
