Honduras’ Special Economic Zone, the SEZ (also known as the Honduras Prospera Zede), has revealed plans to make BTC a legal tender where residents can use the leading digital currency for payment settlements.
Highlights From The New Policy
Also, the legal tender approval will enable firms to launch and run BTC bond offerings in that region. Honduras’ SEZ confirmed the rumors about this news earlier today to make the announcement official. The news means that Honduras’ SEZ is now the second nation to officially approve BTC as a legal tender after El Salvador. The only difference is that El Salvador’s BTC legal tender spans across the whole country, while Honduras’ is limited to the areas within the SEZ.
This SEZ includes regions within the Island of Roatan in the Western Caribbean and the northern region of Honduras. Despite the surprise in this announcement, the success or failure of this policy within the next few months will determine how quickly other nations would be willing to adopt a similar policy. Per the announcement, the SEZ will also authorize international companies, municipalities, and local governments to launch BTC bonds.
This is also a boost for the leading digital asset. Honduras’ SEZ hopes that this move will make the region more attractive for direct international investment, which will positively affect the region’s economy. One salient aspect of this new policy is that payment settlements involving BTC won’t be subjected to capital gains tax. Also, residents can pay their taxes and fees in BTC.
Furthermore, officials are optimistic that issuing a BTC bond will provide international exposure for local communities to the global crypto space. Thus, crypto investors can positively transform these local and poor communities. For example, they can become innovative crypto hubs.
Other Countries Might Seek To Follow The Same Step
Making BTC a legal tender in Honduras’ SEZ is a strong move that could spur other nations to think about taking a similar step. It may even become the yardstick for other regions in Honduras to take a similar step.
However, much will depend on this policy’s near-term effect on the SEZ region. The good news is that this region is starting to enjoy certain benefits of implementing this policy. One such benefit is installing and using crypto ATMs in various places in this region.
Hondurans’ Concerns About Crypto-Investment
But some Hondurans are worried about investing in the crypto space following incessant media advertisements by the nation’s apex bank. The Bank keeps warning the citizens against investing in cryptocurrencies. In its adverts, the apex bank reiterates that the government won’t assist crypto investors in recouping their losses if their crypto investments turn bad.
Unfortunately, Hondurans shouldn’t expect encouragement from other top economies and international monetary regulators such as the IMF. Other authorities and the IMF continually see the negatives in anything that has to do with crypto. They were also highly critical of El Salvador’s decision to make BTC a legal tender. Hence, Hondurans shouldn’t expect less.