- Panama City will now accept BTC, ETH, USDC, and USDT for public services and local taxes.
- The city bypassed new legislation by partnering with banks to convert crypto to U.S. dollars.
- Panama joins global cities embracing crypto for public payments, signaling broader adoption ahead.
Panama City is stepping into the future of finance. The capital has officially approved the use of cryptocurrency for public payments. Citizens can pay their taxes, fees, permits, and tickets using Bitcoin, Ethereum, USDC, and USDT. The city council passed the proposal this week, making it the first public institution in Panama to accept crypto.
In an X post on Wednesday, Mayor Mayer Mizrachi announced the decision, stating that the city has partnered with a bank to convert their crypto into U.S. dollars during transactions. Mizrachi added that this would enable the government to remain compliant with Panama’s financial rules, requiring institutions to make purchases via the USD.
Previous administrations attempted to pass crypto legislation but faced roadblocks in the Senate. However, Panama City bypassed this by using existing legal frameworks. “We found a simple way to do it without new legislation,” Mizrachi stated. This strategy enables the free flow of digital assets in both the government and the wider economy.
With this move, Panama City joins the growing list of governments exploring digital currencies for public services. Earlier, in 2021, El Salvador made headlines by adopting Bitcoin as legal currency, followed by the Central African Republic. Other countries, like Fiji and Tonga, have also shown interest in using crypto at the national level.
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Meanwhile, in the United States, several cities and states have launched similar programs to adopt crypto assets for public services. In 2022, Colorado accepted crypto for taxes, with North Carolina introducing a similar bill soon after. Later, in 2024, Detroit accepted city fees and taxes through a PayPal-powered platform, following which the platform expanded its crypto offerings to trading and stablecoin support.
Despite these moves, actual usage has remained low in some places. Notably, Colorado has collected only $57,000 in crypto tax payments over three years. Still, officials push for broader adoption, citing the benefits of innovation and financial inclusion.
With Panama’s latest crypto policy in place, it paves the way for several Latin American cities to follow suit. While no timeline has been shared for accepting additional tokens, the groundwork is now in place. As crypto continues gaining traction, more governments may look to replicate this model.
