The Government of Bermuda has announced a groundbreaking partnership with cryptocurrency giants Coinbase and Circle to establish a "fully onchain" national economy. This initiative, revealed at the World Economic Forum's annual meeting in Davos, Switzerland, aims to integrate blockchain technology and digital assets into everyday government operations, businesses, and consumer activities.

The collaboration focuses on leveraging stablecoins like Circle's USDC as the core of Bermuda's financial infrastructure. By doing so, the island nation seeks to address longstanding challenges with traditional payment systems, which are often expensive and restrictive for small economies like Bermuda's. These issues stem from being lumped in with other island jurisdictions, leading to higher fees and limited access to mainstream banking services.

Premier E. David Burt emphasized the transformative potential of the project in a statement: "This initiative is about creating opportunity, lowering costs, and ensuring Bermudians benefit from the future of finance." The plan includes piloting stablecoin payments across government agencies, encouraging local businesses to adopt USDC for transactions, and assisting financial institutions in incorporating tokenization and other digital tools.

Bermuda's push toward an onchain economy builds on its early adoption of digital asset regulations. Back in 2018, the country enacted the Digital Asset Business Act, one of the world's first comprehensive frameworks for cryptocurrencies. Both Coinbase and Circle were among the initial licensees under this regime, with Coinbase operating a Bermuda-based platform for international derivatives trading.