As the acceptance of digital currencies continues to increase, the Swiss canton of Zug, home to hedge funds, cryptocurrency companies, and exchanges, will begin to allow citizens to use Bitcoin and Ethereum to pay taxes.
The local government said in a statement on Thursday: “Companies and individuals can use cryptocurrency for tax settlements up to a maximum of 100,000 Swiss francs (US$109,670).”
This region with a population of 127,000 is working with Zurich-based company Bitcoin Suisse AG, which converts cryptocurrencies into francs and transfers the amount to the state.
Since 2016, the canton of Zug, known for its low corporate taxes, has been accepting Bitcoin payments for certain government services and inspired the ski resort Zermatt to follow suit.
Thanks to its good supervision and positive attitude towards cryptocurrency, cryptocurrency companies have gained attention in Switzerland. However, concerns about high volatility and security overwhelmed the recent trading boom, and the country’s major banks and their global counterparts have so far not provided blockchain-based services to customers.
According to Swiss Bitcoin founder and chairman Niklas Nikolajsen, now, as Bitcoin has soared during the COVID-19 pandemic, experts believe that it can act as a hedge against inflation, and the banking leaders may change their minds again.
Nikolajsen said in an interview in Zug: “Everyone cares about a $500 billion market. There is almost no controversy about Bitcoin transactions, it is completely mainstream.”