Honduras’ Próspera Zone recognizes Bitcoin as an official unit of account

• Próspera Zone in Honduras officially recognizes Bitcoin as a unit of account, expanding financial freedom.
• Acting manager Jorge Colindres leads the initiative, emphasizing the right to financial flexibility.
• Despite temporary limitations, entities opting for Bitcoin can calculate tax obligations internally.

In a significant development, the Próspera Special Economic Zone (SEZ) in Roatan, Honduras, has officially recognized Bitcoin (BTC) as a unit of account, further solidifying its commitment to financial innovation.

This move comes less than two years after the region embraced Bitcoin as a legal tender, demonstrating a progressive stance toward the integration of cryptocurrencies into the traditional financial system.

Aiming for financial freedom

Jorge Colindres, the acting manager and tax commissioner of Próspera Zone for Employment and Economic Development (ZEDE), spearheaded this initiative, aiming to provide greater financial flexibility to residents and businesses operating within the SEZ. Colindres, in a January 7 announcement on X, emphasized the belief in the right to financial and monetary freedom, asserting that individuals should be free to conduct transactions, manage accounting, and report taxes in the currency of their choice.

En @ProsperaZEDE creemos en el derecho a la libertad financiera y la libertad monetaria. Las personas deben ser libres de realizar transacciones, llevar su contabilidad y reportar impuestos en la moneda de su libre elección. #Honduras #BTC https://t.co/nlaFLtheRL

— Jorge Colindres (@GeorgeColindres) January 7, 2024

While the decision has been celebrated for its potential to enhance financial freedom, Colindres acknowledged certain temporary limitations. The “Final BTC Tax Payment Procedure” is currently on hold due to technological challenges with the eGovernance system and external regulatory obstacles. Despite this, entities opting for Bitcoin will calculate tax obligations using BTC internally, reporting them to Próspera ZEDE in either US dollars or the Honduras lempira.

Colindres assured that once these challenges are addressed, businesses can directly report and settle tax dues in BTC to Próspera ZEDE.

For businesses interested in adopting Bitcoin as their primary currency, a formal request must be submitted to Próspera’s tax committee within 30 days of the relevant tax period. This request should reference an approved cryptocurrency exchange, such as Coinbase or Kraken, emphasizing the SEZ’s commitment to ensuring compliance and legitimacy in the adoption process.

Próspera ZEDE zone in Roatan Island

Próspera ZEDE, launched in May 2020 on the northern island of Roatan, continues to position itself as one of the most competitive special regimes in Latin America. With over $100 million received in its three-year tenure and the creation of more than 3,000 jobs across the country, Próspera stands as a testament to Honduras’ commitment to embracing innovative financial solutions.

This move follows in the footsteps of El Salvador, Honduras’ neighbouring country, which made history by adopting BTC as legal tender in 2021. As Próspera ZEDE pioneers the recognition of Bitcoin as a unit of account, it sets a precedent for other regions considering similar measures to embrace the ever-evolving landscape of digital currencies.