Bermuda Targets Fully Onchain National Economy With Support From Coinbase and Circle

The Government of Bermuda has unveiled an ambitious initiative to transform its national economy into a fully onchain system, leveraging blockchain and digital asset technology to modernise payment rails, boost financial inclusion, attract innovation and lower transaction costs. This plan — designed in collaboration with Coinbase and Circle — was announced at the World Economic Forum Annual Meeting in Davos, Switzerland and marks one of the most comprehensive efforts by a sovereign jurisdiction to integrate digital financial infrastructure at a national scale.

Bermuda’s vision is to become a global leader in blockchain-powered finance, using digital assets as foundational economic infrastructure across government services, private sector activities, and everyday payments for consumers and businesses alike.

Vision: From Traditional Payments to Onchain Infrastructure

At the core of Bermuda’s strategy is the ambition to transition away from legacy payment systems — which can be costly and fragmented, particularly for a small island jurisdiction — and adopt blockchain-based financial tools that support real-time digital transactions, stablecoin payments, tokenisation and broader digital asset use.

This initiative builds on Bermuda’s long-standing openness to digital assets and crypto regulation: the island introduced the Digital Asset Business Act in 2018, one of the world’s early comprehensive frameworks for digital finance. Circle and Coinbase were among the first major global crypto firms to secure licences under this regime, creating a strong regulatory foundation for deeper collaboration.

Bermuda’s Premier, E. David Burt, said the plan is anchored in collaboration between government, industry and regulators to responsibly accelerate innovation. “This initiative is about creating opportunity, lowering costs, and ensuring Bermudians benefit from the future of finance,” he remarked during the announcement.

Partnership With Coinbase and Circle

Role of Coinbase

Coinbase — one of the world’s largest cryptocurrency exchanges — is providing blockchain infrastructure and enterprise tools to support government agencies, banks, insurers, merchants and consumers on the island. The company’s technologies will underpin elements of Bermuda’s onchain economy, including the settlement of transactions and the integration of distributed ledger offerings.

Coinbase’s involvement is non-exclusive, and the government retains flexibility to work with other technologies and partners over time.

Role of Circle and USDC

Circle — issuer of the USDC stablecoin — is central to the project due to the stablecoin’s dollar-pegged nature and widespread adoption. Bermuda plans to pilot USDC-based payment systems in both public and private sector transactions. USDC enables fast, low-cost, dollar-denominated payments, addressing a key challenge for the island’s local commerce, which historically faces higher transaction fees and limited access to onshore banking infrastructure.

Several Bermudian businesses have already begun accepting USDC in real-world transactions, and broader adoption is expected as the initiative expands.

How an Onchain Economy Works

An onchain economy refers to an economic system where transactions, contracts and financial infrastructure are executed and recorded on a blockchain — a decentralised, transparent digital ledger.

Under this model:

• Payments can be made using tokenised digital assets such as stablecoins (e.g., USDC).
• Tokenisation allows assets (financial instruments, real estate, commodities) to be represented digitally on blockchain, enhancing liquidity and accessibility.
• Smart contracts automate and enforce agreements without intermediaries.
• Digital wallets and identity systems enable individuals and businesses to interact with the financial system directly.

This approach aims to deliver faster settlement times, lower costs, improved accessibility and innovative financial services relative to traditional systems.

Pilot Programs and Implementation Phases

The Bermuda government has outlined a phased implementation strategy that will unfold over the coming months and years:

1. Stablecoin Payment Pilots

Government agencies will begin piloting stablecoin-based payment systems, allowing public transactions to be executed using USDC or other digital assets. These pilots aim to demonstrate real-world utility and build confidence among government stakeholders.

2. Adoption by Businesses and Financial Institutions

Local banks, insurers and small to medium-sized enterprises (SMEs) will be supported to integrate tokenisation tools and digital payment solutions into their operations. Technical onboarding and infrastructure support will be provided by Coinbase and Circle.

3. Digital Literacy and Education

A nationwide programme will educate residents and businesses on blockchain technology, stablecoins and digital wallets, ensuring broad understanding and adoption of onchain tools.

4. Ongoing Evaluation and Expansion

The initiative will continue to evolve through events like the Bermuda Digital Finance Forum 2026 — scheduled for May 11–14 — where stakeholders will share results, expand pilot programs and engage the global digital finance community.

Economic Benefits and Strategic Rationale

Bermuda’s foray into a fully onchain economy is intended to deliver several economic advantages:

Lower Transaction Costs

Traditional payment rails can be expensive — especially for a small jurisdiction like Bermuda that is often grouped with larger island economies for payment processing. Onchain systems reduce intermediary fees and settlement costs.

Greater Access to Global Finance

By embracing digital finance infrastructure, Bermudian businesses can interact with global markets more efficiently, without relying exclusively on traditional banking networks. Stablecoins and tokenised finance broaden access to capital and payments solutions.

Boosting Financial Innovation

The initiative positions Bermuda as a pilot jurisdiction for blockchain innovation, attracting technology firms, investors and financial services that wish to test and build new digital economy models within a regulated environment.

Economic Resilience and Inclusion

Digital payments and tokenised assets can enhance financial inclusion and provide resilient alternatives to legacy systems susceptible to bottlenecks or single points of failure.

Regulatory Backdrop and Historical Context

Bermuda’s leadership in digital finance is anchored by regulatory foresight. The Digital Asset Business Act of 2018 was among the earliest frameworks globally to comprehensively regulate digital asset firms, creating a welcoming environment for companies like Circle and Coinbase to operate and innovate.

Industry Response and Global Implications

Analysts and industry observers see Bermuda’s onchain economy strategy as a bold blueprint for sovereign digital finance adoption. If successful, it could serve as a model for other small economies and jurisdictions exploring digital asset integration, demonstrating how blockchain can support public services, commerce and financial infrastructure at scale.

However, the initiative remains voluntary and non-exclusive — participation is not mandatory for residents or businesses, and Bermuda can collaborate with other technology partners beyond Coinbase and Circle.

Conclusion: A National Step Toward Onchain Economic Infrastructure

Bermuda’s push to build a fully onchain national economy represents a pioneering experiment in sovereign digital finance. By bringing together government, industry leaders like Coinbase and Circle, and a regulatory foundation that embraces innovation, the initiative seeks to leverage blockchain and stablecoin technology to lower costs, enhance financial accessibility, and create a modern economic model fit for the digital age.

The journey ahead will test how onchain systems can function as real-world national infrastructure, but Bermuda’s strategy places it at the forefront of global digital finance experimentation.

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