In a groundbreaking announcement, the city of Detroit revealed on Thursday that residents will soon be able to pay their taxes and other city bills using cryptocurrency through PayPal. The crypto payment option, which will be offered via a “secure payment platform managed by PayPal,” according to the release, is expected to go live in mid-2025.
A spokesperson for the city told CoinDesk that Detroit will only accept the cryptocurrencies supported by PayPal—Bitcoin, ether, Bitcoin Cash, Litecoin, and PayPal’s own stablecoin, PayPal USD—but all crypto payments will be settled in USD. Once Detroit officially begins accepting crypto payments, it will become the largest US city to do so.
Two other cities—Miami Lakes, Florida and Williston, South Dakota—already accept crypto payments for some city bills, utility payments, or taxes, as do three states—Colorado, Utah and Louisiana. Each has partnered with a third-party payment processor like PayPal or BitPay that converts the crypto payments to US dollars.
Embracing New Technologies for Economic Growth
According to the city’s announcement, Detroit’s decision to allow crypto payments is part of a larger push to embrace new technologies to spur economic growth and encourage blockchain and technology companies to relocate to Detroit.
“Detroit is building a technology-friendly environment that empowers residents and business owners,” Mayor Mike Duggan said in a statement. “We are excited to become one of the first major US cities to explore blockchain civic applications and allow residents to use their cryptocurrency as a payment option.”
In addition to announcing the new crypto payment option, Detroit is calling on crypto entrepreneurs to pitch their ideas for blockchain-based “civic applications” focused on “enhancing transparency, improving data security and streamlining public services” to the city’s first Director of Entrepreneurship and Economic Opportunity Justin Onwenu.
“This announcement represents our openness to new ideas and dedication to positioning Detroit as a place for entrepreneurs and bold concepts to thrive,” Onwenu said in a statement. “Blockchain technologies have the potential to drive greater accessibility, efficiency, transparency, and security, and we’re excited to hear from entrepreneurs leading this work.”
Becoming a Crypto-Friendly City
By embracing cryptocurrency payments and encouraging blockchain innovation, Detroit is positioning itself as a forward-thinking, crypto-friendly city. The move could attract tech talent and investment to the area, boosting the local economy.
Other cities and states that accept crypto payments have reported positive results. For example, sources say Miami Lakes has processed over $1 million in crypto payments since launching its program in 2021. Colorado, which began accepting crypto for tax payments in 2022, has reportedly received hundreds of crypto payments totaling millions of dollars.
However, there are also challenges and risks to consider. Cryptocurrency prices are notoriously volatile, which could impact the value of payments between the time they are made and when they are converted to dollars. There are also regulatory uncertainties surrounding cryptocurrencies.
Looking to the Future
Despite the potential hurdles, Detroit’s embrace of crypto payments and blockchain technology signals a willingness to innovate and adapt to the digital age. As more cities and states follow suit, it could pave the way for wider mainstream adoption of cryptocurrencies.
The specific blockchain civic applications that will emerge from Detroit’s call for ideas remain to be seen, but they could include anything from secure record-keeping to transparent contract management to streamlined public services. By getting in on the ground floor, Detroit has the opportunity to shape the future of municipal blockchain innovation.
As Detroit looks to reinvent itself for the 21st century, its bold bet on crypto and blockchain could be a key part of the equation. With the crypto payment option set to launch in 2025 and entrepreneurs already brainstorming civic applications, the Motor City is revving up for a high-tech renaissance.
