Honduras Special Economic Zone Declares Bitcoin as a Legal Tender

Próspera, a special economic zone located in Roatan, Honduras, has declared Bitcoin and other cryptocurrencies as legal tenders within its jurisdiction, according to a press release on Thursday.

Próspera Adopts Bitcoin

Próspera is a private charter city and a special economic zone on the island of Roatán. It is an autonomous zone created to encourage investments, innovations as well as providing employment. The zone has its own fiscal, regulatory, and legal framework.

As per the development, residents and businesses can now use Btc and other crypto assets as payments for tax, goods, and fees with 0% tax obligations on their transactions.

Additionally, municipalities, local governments, and international companies are allowed to issue Bitcoin bonds with KYC and AML rules in order to attract foreign investors. Residents will also be permitted to build crypto-focused businesses while still applying the KYC and AML framework.

However, U.S.-based firms are excluded from issuing Bitcoin bonds via Próspera’s innovative regulatory system.

Honduras Central Bank Does Not Support Crypto

Following several reports that Honduras is poised to make Bitcoin a legal tender, in March, the Central Bank of Honduras (BCH) released a notice disapproving of such claims.

The apex bank noted that Bitcoin is not regulated in the country and would not be made legal tender.

“BCH does not supervise or guarantee operations carried out with cryptocurrencies as a means of payment. Any transaction carried out with these types of virtual assets is the responsibility and risk of those who do it,” the bank said.

Following El Salvador’s Footstep

Meanwhile, the country’s neighbor, El Salvador, took a bold step last September to legalize Bitcoin. Since then the volcanic nation has been purchasing and adding BTC to its treasury.

El Salvador also announced plans to construct the world’s first crypto-powered city dubbed “Bitcoin City,” which it said will be backed by a $1 billion Bitcoin bond.

The country has also faced criticism from the government and organizations for its move.

More recently, U.S. representatives, Congresswoman Norma J. Torres and Congressman Rick Crawford, proposed a companion bill to mitigate the supposed risks associated with El Salvador’s Bitcoin adoption.

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