Bitcoin has been used to pay for many things, from property to schooling and taxes. It seems as if the island nation of Vanuatu has taken that one step further. They are the first country which has begun to accept Bitcoin in exchange for citizenship.
With about 41.5 Bitcoins, you can purchase a passport from Vanuatu. At current prices, that is about $200,000 which brings it in line with many of the other citizenship for cash programs. Given that Vanuatu is a member of the commonwealth, it allows you visa free travel to over 100 countries including the much of the EU.
Forefront of New Technology
This falls well into place with the initiatives of the government of Vanuatu. They would like to be seen as a country which is explicitly targeting new technology. They will require all of the normal required due diligence for anti-money laundering etc.
This has indeed given Vanuatu a considerable competitive advantage over numerous other countries. The advisor to the government on the program, Christian Nesheim said this could be a great alternative for those early Bitcoin adopters who would like to realize profit on some of their coins without incurring capital gains taxes. He went on to say:
As Vanuatu will now be the only country to offer citizenship for bitcoins, I think the program will see a surge in interest more or less immediately.
Many people could have pointed out that this would have been suspicious given the general associations of Bitcoin. However, James Harris who is the managing director of the VIC has pointed out that the use of cryptocurrencies is not as anonymous as many people may claim.
All transactions are present on the public blockchain and, as such, are fully open to scrutiny. He claims that the acceptance of Bitcoin for the citizenship program is further strengthening their procedures against any money laundering.
An Entire Industry
There is indeed a massive business behind investment in immigration programs. There are estimates that these programs could bring in about $2bn every year for the countries that offer them. These range from investments in residency permits to those that sell passports.
For example, Thailand has recently announced that they will offer wealthy investors the opportunity to join their elite residency program. For $60,000 upfront and $600 annually, you can get 20 year residency rights to Thailand. On the other end of the spectrum, for an EU passport you can spend €2 million for investment in Cyprus which will entitle you to their passport. According to business insider this program
…earns as much as €4 billion a year, or around 25% of its GDP
These programs are traditionally aimed at wealthy families that wanted to broaden the scope of their businesses and provide their families with more opportunity. However, the Vanuatu program is no doubt aimed at more tech savvy Bitcoin early adopters who will probably provide a more interesting skill set to their citizenry.
Featured Image via Fotolia
