Honduras Economic Zone Recognizes Bitcoin As Legal Tender

The Honduras Próspera ZEDE special economic zone will make bitcoin legal tender and allow it to be used for payments within the jurisdiction. It will also allow entities to issue bitcoin bonds from the SEZ.

The Próspera ZEDE economic zone in Honduras announced in a press release that it will make bitcoin a de facto currency. This is a considerable move that is only outdone by El Salvador’s decision to make bitcoin legal tender, even if the move is limited to the economic zone. In the Próspera ZEDE zone, BTC and even other cryptocurrencies will effectively serve as legal tender in the jurisdiction.

The special economic zone (SEZ) is located on the island of Roatán in the Western Caribbean and the Northern Corridor of Honduras. The announcement comes as something of a surprise, and will certainly begin stirring discussion in other countries — depending on how this move pans out, of course.

There are more positive developments as announced in the press release. Municipalities, local governments, and international firms will be able to issue Bitcoin bonds from the SEZ, which is another major move for the asset. The hope is that this will attract foreign direct investment and boost economic development.

With the new change, individuals and businesses can use bitcoin as payment — and transactions in bitcoin and other cryptocurrencies will not be subject to capital gains tax. Taxes and fees can also be paid in BTC.

As for the Bitcoin Bond, officials hope that it will allow local communities to have direct access to the global crypto market. Consequently, they believe it can “help transform impoverished communities into flouring centers of innovation and prosperity.”

Bitcoin becoming more attractive to many countries

While this move is only applicable to the jurisdiction of the Próspera ZEDE economic zone, it is still a powerful one that could have other countries thinking about the same. This is an experiment that could showcase the many benefits of bitcoin and other cryptocurrencies. The country also has its own crypto ATMs.

The country’s central bank has made multiple statements warning investors about cryptocurrencies, so there’s certainly some apprehension within the country. The bank has said that crypto transactions have risks and the individual or group is responsible for the repercussions.

However, the response from the wider world may not all be good. El Salvador received a lot of flak for its decision to make bitcoin legal tender and continues to do so.