If previously bitcoin seemed to be restricted to investors and companies in the crypto universe, now it is increasingly present in more “traditional” institutions. After Tesla’s announcement, Miami’s City Hall informed that bitcoin can be used in transactions linked to public service. However, the movement is not restricted to the American city. For Safiri Felix, director of Products and Partnerships at Transfero, it demonstrates the maturity of the market and should intensify.
In early February, Tesla sent a document to US Securities and Exchange Commission (SEC) informing the purchase of US$ 1.5 billion. The decision came shortly after MicroStrategy founder Michael Saylor advocated that Elon Musk’s company turn part of its balance sheet into cryptocurrencies. At the time, experts pointed to the expectation that the move would encourage other companies outside the crypto sector to join the bitcoin.
And this seems to be becoming a reality. On February 11, Francis Suarez, the mayor of Miami, announced on Twitter a proposal to use bitcoin for different purposes. The proposal was supported by city commissioners this monday (3/1). In a video, the mayor explains that the idea is to allow city employees to choose to receive their full salary or part of it in bitcoin. Besides, he wants to make it possible to pay taxes and fees with cryptocurrency. A city commission has approved the resolution, but with the foresight to study its practicality.
City Hall also wants to invest in bitcoin
According to Bloomberg, the original idea was to put the plan in place already as soon as the proposal was approved. The mayor also wants the city to consider the possibility of investing part of the government’s funds in bitcoins. This, however, may come up against restrictions that Florida – the state where Miami is located – imposes on investments in volatile instruments.
“The growing entry of companies is an unequivocal proof of the maturity of the market and the macro, global context”, assesses Felix. In the executive’s opinion, this context “makes companies have to look for alternatives to protect their cash against an eventual inflationary spiral”.
He also believes that the movement tends to intensify over time. He points to Tesla and MicroStrategy as pioneers of this migration. “Without a doubt, they have a slightly bolder profile because they are pulling this line. But the perspective is that this will become something usual in the decision of companies in a very short time.
Felix points out that at least five other companies which are part of the Fortune 500 (index of the 500 largest U.S. companies listed on the Stock Exchange) that are already suitable to operate in the crypto market. “So it’s only a matter of time before we have new additions from publicly traded companies allocating part of their cash to bitcoin”, he concludes.
“Traditional” banks and credit cards are riding the crypto wave
Another locality that has embraced bitcoin is the Canton of Zug in Switzerland, home to Crypto Valley, a hub of companies in the crypto sector. While Zug’s municipality (the canton’s capital) had already accepted bitcoin for tax payments since 2016, the canton did not adopt the cryptocurrency for this purpose until February 2021.
Now it will be possible to make these payments in bitcoin or Ether. For such purpose, the citizen should scan a QR Code and use his digital wallet preferably. According to The Block Crypto, payment with cryptocurrencies is limited to expenses of 100 thousand Swiss francs.
Another traditional financial company that’s been showing support for bitcoin is credit card provider Mastercard. On February 10, it reported that its network will now support payments in some cryptocurrencies. In a statement, the company said that “the point is that these digital assets are becoming a more important part of the payments world”.
However, Mastercard is not the only credit card company to offer such support. In late January, Visa announced the Visa Crypto APIs project so that banks can offer services with bitcoin and other crypto-assets. The company is also interested in adding cryptocurrencies to its payment network, as its CEO Alfred Kelly said in early February. In December, Visa entered into a partnership with the stablecoin USDC.