Panama legalizes use of crypto for taxes and all legal transactions

Panama's National Assembly approved a law that will govern the use of cryptocurrency in the Panama. Although this law didn't term Bitcoin as legal tender, its implications makes Bitcoin permissable for all legal transactions.

The Act enables both private and public use of digital assets, and also lets citizens pay taxes with crypto. In the context of bitcoin adoption, Panama now joins the ranks of El Salvador and Central African Republic.

Map showing countries where Bitcoin is legal tender

by Bitcoin Archive

The legislation is larger in scope than provisions enacted by El Salvador, which made bitcoin legal tender last year.

The bill regulates the exchange and usage of cryptocurrencies, as well as the issuance of virtual securities and the development of new payment options.

Silva said, "We're seeing the emergence of many different types of crypto assets like works of art. That's why we didn't want to limit ourselves only to cryptocurrencies."

Panamanians can now pay with crypto assets for any civil or economic transaction that is not outlawed by Panamanian law.

The bill passed with 38 votes in favor, two abstentions, and no legislators voting against it. It will now be signed by President Laurentino Cortizo.

The development comes just a day after the Central African Republic's parliament unanimously passed a statute governing the use of cryptocurrency last week, according to a statement signed by Obed Namsio, President Faustin-Archange Touadera's chief of staff.

Bitcoin: strong arguments the horizon is still bright

It was obvious the Federal Reserve had to start increasing interest rates to keep inflation better under control and get it back to its goal level of about two percent from the moment it understood it had a serious problem to deal with.

Investors began selling off these kinds of equities and asset classes when the market understood that this would have a bad impact on future working capital, particularly of high-growth technology firms in order to reduce risk.

A period of association between Bitcoin and high-growth tech stocks resulted from the fact that so many large shareholders held holdings in Bitcoin (BTC-USD) once the sell-off started, which is the primary factor that has reduced the value of cryptos.

Global cryptocurrency adoption is still high

Global Bitcoin and cryptocurrency adoption is rising for a number of reasons, including their capacity to store value, rising investor demand, institutional recognition of them as an asset category, decentralization, excellent user control, and the ability to help the unbanked in lower and middle nations.

In my view, when analyzing the probable future growth trajectory of Bitcoin, adoption rates are perhaps the most crucial factor to take into account.

Even though growth has slowed since the price of Bitcoin fell in 2022, it is still far higher than it was prior to the 2020 bull market.

Bahrain has partnered with EazyPay to enable users to use cryptocurrency at more than 5,000 point-of-sale ("POS") sites, making it one of the more recent nations to accept cryptocurrencies such as Bitcoin as a form of payment. Although more than 70 cryptos will be available for use in transactions, I predict that Bitcoin will be the most popular choice, which will further increase acceptance.

I predict that a significant number of nations will adopt several similar moves.

The first state to do so in the United States, Colorado, declared that it will accept Bitcoin as payment for taxes. The decision does not involve businesses.

The "PayPal Cryptocurrencies Hub" will handle the transactions, so Colorado citizens will also have the choice of paying their taxes with Litecoin, Ethereum, or Bitcoin Cash (BCH-USD).

Together, they offer convincing evidence that Bitcoin adoption will continue to rise. The moment the Federal Reserve and other monetary authorities stop raising interest rates to fight inflation, the combination of rising adoption and a resurgence in positive sentiment will drive the price of Bitcoin significantly higher.