Panama City to accept crypto for taxes, permits and fines via bank conversion

Panama City’s municipal government has approved the use of cryptocurrency to pay for taxes, fees, tickets and permits, according to a Wednesday post on X by Mayor Mayer Mizrachi Matalon. The city will accept bitcoin, ether, USDC and USDT, local media confirmed.

Panama City now joins other cities worldwide interested in permitting cryptocurrencies for municipal payments. Mizrachi said the Panamanian capital implemented the policy without the need for new legislation by working with a partner bank that will convert the crypto into U.S. dollars at the time of payment.

Like El Salvador, the greenback is legal tender in Panama.

“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 [sic],” Mizrachi wrote. “Legally public institutions must receive funds in $, so we partner with a bank who will take care of the transaction receiving in crypto and convert on spot to $. This allows for the free flow of crypto in the entire economy and entire government.”

Several cities, including those in the United States, have recently sought to accept cryptocurrency for governmental payments. In November 2024, Detroit gave its citizens the option to pay city fees and taxes through a PayPal-based payments platform. Though commonly used for non-crypto money transfers, PayPal has not only launched its own stablecoin, PYUSD, but also integrated crypto trading infrastructure, such as buying and selling solana, into its platform.

On the U.S. state level, Colorado began accepting cryptocurrency for tax payments in September 2022. North Carolina also introduced a bill to allow residents to use select cryptocurrencies for taxes and other transactions, as previously reported by The Block.

While there has been an uptick in municipalities allowing crypto payments, citizens may not be quick to pay for taxes in crypto. Recent reporting from the publication Colorado Newsline found that Colorado citizens submitted $57,211 for tax payments in cryptocurrency since it was allowed roughly three years ago, when the state generally takes in billions for tax revenue each year.