Panama City Accepts Bitcoin for Taxes, Aims to Lead Crypto Hub

Panama is actively developing its Bitcoin strategy, aiming to position itself as a leading crypto hub in Central America. The country's efforts began with an announcement from Panama City’s mayor, Mayer Mizrachi, who revealed that the city would start accepting Bitcoin (BTC) and other cryptocurrencies for tax payments. This initiative was part of a broader plan to integrate cryptocurrencies into the city's financial system, partnering with Towerbank, a crypto-friendly bank, to facilitate these transactions.

Mizrachi highlighted that the agreement allows the municipality to accept payments in BTC, ETH, USDT, and USDC, with the municipality receiving dollars, thereby eliminating the need for new laws to adopt these cryptocurrencies. This move not only expands payment options for citizens and businesses but also signals Panama's commitment to embracing Bitcoin and other digital assets. The mayor's participation in the Bitcoin Conference in Las Vegas further underscored Panama's potential as a key player in the crypto industry.

Panama's strategy extends beyond tax payments. The country is also working on a regulatory framework to support its Bitcoin initiatives. In April 2022, Panama's National Assembly passed Bill No. 697, which aimed to regulate the use of cryptocurrencies and digital assets. However, President Laurentino Cortizo partially vetoed it in June 2022. Despite this setback, efforts continued, with Congressman Andrés Solís Arias proposing a new draft bill in March 2025. This bill promotes the voluntary acceptance of cryptocurrencies in commercial transactions and mandates licensing and registration requirements for Virtual Asset Service Providers, aligning with regional regulations.

The proposed bill also encourages the integration of blockchain technology within public administration and recognizes smart contracts as legally enforceable instruments. The goal is to strengthen Panama's position as a leading fintech jurisdiction in Latin America. While the bill has yet to be approved, the community's excitement around it is palpable, with Solís emphasizing the strategic edge it could provide Panama in the global digital economy. The development of Panama's Bitcoin strategy could significantly influence the adoption of digital assets in Central America, potentially inspiring neighboring countries to follow suit.