Bermuda is pushing to become the world's first economy to run entirely on a blockchain, said Craig Swan, CEO of the Bermuda Monetary Authority (BMA), speaking at the Digital Money Summit in London. Swan described the initiative as a game-changer for the island's citizens.
In a pilot event, BMA held a large-scale citizen education session, teaching attendees how to set up crypto wallets and airdropping 100 pounds worth of stablecoins to each participant. An on-site marketplace let them spend the tokens immediately, while MoneyGram provided conversion back to fiat currency. Both vendors and the public were onboarded simultaneously, creating a real-world test of the ecosystem.
Starting with the Department of Motor Vehicles
Swan explained that after the sandbox test, the BMA and government are scaling infrastructure. Bermuda has amended legislation to officially accept digital assets for public tax payments, beginning with the Department of Motor Vehicles — a high-volume area serving most car owners and license holders. The plan is to roll out across all government departments.
The financial migration follows a roadmap first unveiled at the World Economic Forum in Davos. Rather than building tech rails itself, the government leverages a network of regulated private-sector financial institutions.
Partnering with Stellar for a Bermuda Digital Dollar
Bermuda recently announced a major partnership with Stellar for the upcoming launch of the official Bermuda Digital Dollar, a sovereign-grade stablecoin running on the Stellar network. Swan expects on-chain rails to coexist with traditional banks, which will continue holding fiat reserves and providing localized custody.
Premier E. David Burt noted that reliance on legacy payment infrastructure has left Bermudians paying high fees, hindering economic growth. Blockchain rails could bypass costly intermediary banking loops, keeping capital circulating on the island.
Legal Overhaul: Property Definitions and Contract Law
Swan emphasized that moving a national economy on-chain requires rewriting more than banking rules. Under current law, it's unclear whether smart contracts satisfy legal transfer of ownership. Share register legislation also needs to explicitly allow digital formats. Bermuda is crafting legal tweaks in these areas.
The island is already a top-three global reinsurance hub, and the government hopes its Digital Asset Business Act (DABA) can replicate that success for tokenized real-world assets (RWAs) and decentralized finance (DeFi).