After El Salvador: Bitcoin is now also legal tender in Honduras

After El Salvador introduced Bitcoin as legal tender last fall, the disputed region of Honduras Próspera is now taking the same step.

The Honduran central bank is critical of this innovation and announced that it will not oversee crypto transactions.

• In early April, ZEDE Honduras Próspera announced that it would introduce Bitcoin as legal tender
• No capital gains tax on Bitcoin: According to Honduras Próspera, it has “the best regulatory environment in the world”
• The Central Bank of Honduras (BCH) does not oversee or guarantee crypto trades

At the beginning of April, the Honduran region of Honduras Próspera announced that it would introduce Bitcoin as legal tender – effective immediately in certain areas. Honduras Próspera is an autonomous special zone for work and economic development (ZEDE) and the second region ever to have taken this step. El Salvador became the first country in the world to introduce Bitcoin as legal tender in September last year.

Honduras Próspera advertises with “the best regulations in the world”

The introduction of Bitcoin as legal tender should make Honduras Próspera even more attractive for investors – the region writes on Twitter: “Bitcoin companies can work in Próspera with the best regulatory environment in the world.” In Honduras Próspera, no capital gains tax is payable on Bitcoin and other cryptocurrencies. Instead, it is now possible to pay taxes in Bitcoin.

Honduran central bank takes a critical view of bitcoin as legal tender

“This new form of FDI, coupled with Próspera’s services, can help transform impoverished communities into thriving hubs of innovation and prosperity,” Honduras Próspera said in the official press release announcing the adoption of Bitcoin as legal tender. As Heise reports with reference to Reuters, the Honduran Central Bank (BCH) said when asked that it “does not oversee or guarantee operations carried out with cryptocurrencies as a means of payment on national territory.” Instead, studies and analyzes are currently being carried out to determine the implementation possibilities of the “issuance of a central bank digital currency (CBDC) that has the property of being recognized as legal tender in the country.”

The International Monetary Fund (IMF) is also critical of Bitcoin as legal tender: At the end of January, the IMF asked El Salvador to abolish the innovation introduced in September because it entailed too many risks.

The Honduras Próspera region is disputed

Honduras Próspera was founded in 2020 on the Honduran tourist island of Roatán and is largely autonomous – however, according to Heise, a large part of the population is against the ZEDEs in Honduras. President Xiomara Castro, who has been in office since January, even declared in her election program that she wanted to repeal the law on ZEDEs, since the special zones violate the country’s sovereignty.