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Panama City Council Pioneers Crypto Adoption as First Government Entity to Accept Digital Currency Payments

Panama City Council Pioneers Crypto Adoption as First Government Entity to Accept Digital Currency Payments

Published:
2025-04-16 17:00:45
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Panama City Council makes history as the first government institution accepting crypto payments

In a landmark move for both the public sector and the cryptocurrency industry, the Panama City Council has become the first government institution globally to officially accept digital currencies as a form of payment. This historic decision, announced in April 2025, marks a significant step toward mainstream crypto adoption and positions Panama as a leader in blockchain innovation. The council’s initiative enables citizens to pay for municipal services and fees using major cryptocurrencies, demonstrating practical utility for digital assets in government operations. This development is expected to influence other municipalities worldwide to explore similar blockchain-based payment solutions, potentially accelerating the integration of cryptocurrencies into traditional financial systems.

Panama City Council embraces crypto payments for government services 

🇵🇦 Panama City council has just voted in favor of becoming the first public institution of government to accept payments in Crypto.

Citizens will now be able to pay taxes, fees, tickets and permits entirely in crypto starting with BTC, ETH, USDC, USDT@APompliano @aantonop…

— Mayer Mizrachi (@Mayer) April 15, 2025

Panama City has officially adopted Bitcoin and other cryptocurrencies for payments following a recent vote by the city council. Mayor Mizrachi disclosed that cryptocurrencies were now legally recognized as a means of payment, and citizens could now use crypto assets such as Bitcoin (BTC), Ethereum (ETH), USD Coin (USDC), and Tether (USDT) to pay for most government services including taxes and licenses. 

In 2021, Panama followed El Salvador’s lead and took steps towards officially accepting crypto payments as Congressman Silva introduced a bill to regulate its use, and announced that the Panamanian government was seeking to make the country compatible with the blockchain, crypto assets, and the internet. 

Panama passed the law to regulate the use of crypto assets such as BTC in Central American countries in 2022, and it also provided a legal framework for DAOs and STOs. However, the initiative was vetoed by President Laurentino Cortizo, causing the same law to be sent back to Parliament to discuss the vetoed articles.

“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 legislation.”

~ Mayer Mizrachi 

The legislative step brought Panama’s crypto adoption closer to countries such as the U.S., Argentina, and Chile, among others. No one is forced to pay with crypto, but the citizens can use it and there is a law that protects the operation if a conflict arises.

Panama’s crypto use differs from El Salvador’s mandatory Bitcoin adoption 

In April 2025, Panama took a progressive step in crypto regulation with a new bill that proposed the voluntary acceptance of digital assets for payments. Panama’s approach focused on allowing businesses and individuals to accept crypto without the mandatory enforcement in El Salvador which made Bitcoin legal tender. The proposed legislation aimed to modernize Panama’s financial landscape by integrating crypto payments into its economy. 

Additionally, the bill does not limit payments to Bitcoin; it includes Ethereum, stablecoins, and other digital assets. Notably, Panama may freely agree on the use of crypto assets, including without limitation, Bitcoin (BTC), Ethereum (ETH), Ripple’s XRP, Litecoin (LTC), XDC Network (XDC), Elrond (EGLD), Stellar (XLM) and Algorand (ALGO), as a means of payment for any civil or commercial operation not prohibited by Panamanian laws. The Panamanian Constitution recognizes the plurality of currencies that can be used in the country.

According to Congressman Silva, many different types of crypto assets were emerging ‘like works of art’ and that is why Panama did not want to limit itself to any particular crypto asset. He, however, acknowledged that Panama was already in a bad position, and these crypto payment methods skipped the due diligence processes that international organizations were asking Panama to embrace.

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