- Panama City has approved the use of cryptocurrencies for public service payments
- The city has partnered with a bank to convert crypto payments into U.S. dollars
- This initiative has been implemented without the need for new legislation
Panama City has taken a significant step towards integrating digital currencies into its financial system by allowing the use of cryptocurrencies for payments related to taxes, permits, and fines. To comply with existing laws that mandate transactions in U.S. dollars, the city has collaborated with a local bank to handle the immediate conversion of crypto payments into dollars. This move, achieved without introducing new legislation, positions Panama City as a forward-thinking municipality in the realm of digital finance.
A Strategic Move Towards Digital Finance
On April 15, 2025, Panama City’s council voted to accept Bitcoin (BTC), Ethereum (ETH), USD Coin (USDC), and Tether (USDT) for various public services. This decision enables residents to use these cryptocurrencies for payments such as taxes, permits, and fines. Mayor Mayer Mizrachi highlighted the significance of this development in an X post:
Prior administrations tried to push a bill in the senate to make this possible, but we found a simple way to do it without new legistlation. Legally public institutions must receive funds in $, so we partner with a bank who will take care of the transaction receiving in crypto…
— Mayer Mizrachi (@Mayer) April 15, 2025
Given that Panamanian law requires public institutions to conduct transactions in U.S. dollars, the city has partnered with a local bank to facilitate the immediate conversion of cryptocurrency payments into dollars. This approach allows the city to embrace digital currencies while adhering to existing legal frameworks.
Implications for Panama’s Financial Landscape
This initiative reflects Panama City’s commitment to modernizing its financial systems and embracing technological advancements. By integrating cryptocurrencies into public service payments, the city aims to attract tech-savvy residents and businesses, positioning itself as a hub for innovation in Latin America.
While the current system ensures compliance with legal requirements, it also opens the door for future discussions on broader cryptocurrency adoption and potential legislative reforms. The move comes just week after fellow South American country El Salvador was forced to roll back its acceptance of Bitcoin as a legal currency in order to secure an International Monetary Fund loan.
