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Saturday, July 13, 2024

Minister proposes government services paid in crypto

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Liechtenstein Prime Minister Daniel Risch announced plans to accept Bitcoin (BTC) as payment for government services. As reported in local news, the micro-European nation continues to embrace blockchain technologies.

Risch, who also serves as finance minister, is quoted as saying:

“A payment option with Bitcoin is coming.”

However, he did not give a timeframe. Moreover, the principality is unlikely to accept Bitcoin and “hodl” (hold onto) the satoshis it receives. Instead, it will accept deposits in Bitcoin and immediately exchange them for Swiss francs, the national currency. The direct exchange into fiat money sidesteps the currency’s volatility.

Despite not being a European Union member, Liechtenstein is part of the European Economic Area, where the EU’s Markets in Crypto-Assets (MiCA) regulation could apply. This regulatory clarity could attract more crypto firms to the region.

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Similar to Gibraltar and the Isle of Man, Lichtenstein is a small but thriving cryptocurrency hub in Europe. The Liechtenstein Blockchain Act, which passed in 2019, provided clear crypto regulation, with several crypto-focused businesses setting up operations in the country since.

The nation follows a similar course to the nearby Swiss communities of Zug and Lugano, which accept Bitcoin for some taxes and public services, with retailers, including the likes of McDonald’s, also accepting BTC.

Nonetheless, the sixth smallest nation in the world is cautious in its approach to investing in Bitcoin or crypto. Risch expressed that Bitcoin and other cryptos are currently too risky for the country’s multi-billion dollar treasury–but the verdict may change in the future.

Related: Liechtenstein adapts blockchain laws to developing crypto landscape

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This move by Liechtenstein coincides with a growing trend of smaller nations embracing cryptocurrencies and blockchain technology.

Magazine: Bitcoin in Senegal: Why is this African country using BTC?