Bermuda is advancing an unprecedented national-level blockchain experiment. This small island territory is collaborating with Circle, Coinbase, and Stellar to establish the world's first fully integrated full chain economic system, where digital assets will serve as everyday financial infrastructure rather than merely a parallel layer for enthusiasts.
Formation of the Tri-Party Partnership
The initiative was first announced on January 19, 2026, at the World Economic Forum in Davos, with Bermuda declaring its goal to become the world's first fully integrated full chain national economy. Circle and Coinbase will provide digital asset infrastructure and enterprise tools for the Bermuda government, local banks, insurance companies, small and medium-sized enterprises, and consumers.
Subsequently, the Stellar Development Foundation announced that Bermuda would begin transitioning its major payment and financial service activities to the Stellar network, marking the first operational milestone since the announcement in Davos. Stellar's role is focused on the upcoming Bermuda Digital Dollar, a sovereign-compliant stablecoin.
For Bermuda, a small and entrepreneurial economy, the costs and limitations of traditional payment channels are significant. Classifications with Caribbean and other island jurisdictions may increase fees and restrict access to onshore payment processors, further squeezing already thin merchant profits. Local merchants currently pay credit card fees ranging from 3% to 5% per transaction, with effective processing costs for certain categories reaching as high as 10%.
Real-World Testing Underway
The Bermuda Monetary Authority has begun real-world testing by airdropping USDC to residents, allowing them to make payments in a flash market and preparing to accept digital asset payments for government fees, with the first project being the Motor Vehicle Authority.
At the 2025 Bermuda Digital Finance Forum, the three partners conducted a USDC airdrop, with each attendee receiving 100 USDC to use at newly onboarded local merchants. Following this, more Bermuda businesses began accepting digital payments, and local financial institutions expanded their use of stablecoins and tokenized finance.
Regulators are also updating laws regarding property, contracts, and securities while piloting compliance and AI payment centers based on smart contracts, aiming to position Bermuda as a global hub for tokenized assets and decentralized finance.
Rather than building its own central bank digital currency from scratch, Bermuda prefers to collaborate with private sector stablecoin infrastructure. The partnership with Coinbase and Circle is non-exclusive, meaning Bermuda can also collaborate with other companies and technologies, and there is no requirement for residents or businesses to adopt full chain tools. This transformation is expected to yield tangible benefits over time.