Bitcoin Bulls Confront Crucial Challenge in Lugano's Real-World Payment Initiative

In Lugano, residents can now use Bitcoin or USDT to pay for city taxes, fines, and invoices, with immediate conversion to Swiss francs.

Key Takeaways

Lugano residents can pay municipal invoices using Bitcoin and USDT, with instant conversion to Swiss francs.
The city initiative, Plan ₿, includes no limits on the amount payable in cryptocurrency.
Over 350 local merchants now accept crypto payments via the Lightning Network, providing savings on transaction fees.
The MyLugano app offers cashback in LVGA tokens for crypto transactions, fostering a circular economy.
Lugano is seen as a positive model for Bitcoin adoption, highlighted by increased participation in related events.

Lugano street where shops accept Bitcoin payments

The city of Lugano has embraced Bitcoin and USDT as valid payment methods for various municipal fees through its Plan ₿ initiative. This approach allows residents to settle invoices using cryptocurrency, with an emphasis on converting payments into Swiss francs right away. The program not only serves as an alternative payment method but also supports local businesses and promotes a circular economy by incentivizing customers who pay with crypto.

Bitcoin in Everyday Transactions

Outside the city hall in Lugano, the usual queries about permit applications and parking issues have been replaced with frequent requests, such as: “Can I pay this in Bitcoin?” Unlike many other locations, the response here is an easy and straightforward “Yes, of course.”

Thanks to the city’s Plan ₿ initiative, residents can now use Bitcoin (BTC) and Tether’s USDT to settle nearly any municipal obligation—from income and corporate taxes to parking tickets and tuition fees. “Invoices issued by the City of Lugano can be paid with BTC, Bitcoin on the Lightning Network, and USDT,” the city’s payments page states clearly, noting that there is “no amount limit,” even for hefty tax invoices.

Payment Processing and Merchant Perspectives

The payment process typically occurs either directly through the Lightning Network or via a partnership with Bitcoin Suisse, which imposes a 1% fee through the exchange rate to mitigate the risk of converting crypto to Swiss francs. For small business owners and café operators faced with 2.5% to 3.4% card fee charges, this difference is significant, affecting their profit margins.

City officials emphasize that Lugano isn't accumulating a Bitcoin treasury. “Any cryptocurrency payment is immediately converted into Swiss francs and paid to the city,” the guidance states, indicating that cryptocurrency is less about investment speculation and more about facilitating transactions for residents who already hold BTC or USDT.

The Rise of the Circular Economy

While the basic payment infrastructure is essential, Lugano is also fostering a circular economy with the MyLugano app. This app allows shoppers to earn up to 10% cashback in LVGA tokens when they make purchases using cryptocurrencies at participating shops. These tokens can then be used for municipal services, public parking, and childcare expenses. Local advocates assert that this demonstrates the viability of a circular economy; people are actively using Bitcoin to buy coffee and receiving LVGA tokens that can later be spent on kindergarten invoices.

Merchant Participation Growth

Merchant participation is evident throughout the city. Plan ₿ reports that over 350 merchants are now accepting payments via the Lightning Network. This figure is not merely anecdotal; it’s supported by visible stickers on shop windows ranging from gelato shops to vintage watch sellers. A merchant quoted recently stated, “Bitcoin fees are below 1%, whereas my card terminal charges up to 3.4%—I don’t need a financial degree to make that choice.”

Institutional Support and Future Prospects

The supportive environment for cryptocurrency was also evident during the fourth Plan ₿ Forum, held on October 24–25, 2025, which attracted over 4,000 participants from 64 countries—an impressive 140% increase since its launch in 2022. Tether CEO Paolo Ardoino highlighted that “Lugano is evolving into a working model of Bitcoin adoption and open technology,” indicating the ongoing growth in Bitcoin utilization for payments.

For traders focusing on market structure, Lugano's rollout presents a complex scenario. As Bitcoin hovers just below $90,000 with diminishing year-end liquidity, this development may not dramatically influence prices at the moment. However, it creates steady demand; every municipal invoice settled in BTC converted to francs adds subtle selling pressure, while each Lightning Point of Sale (POS) system installed encourages locals to maintain a well-funded hot wallet.

Conclusion: A Shift in Perspective

Does this potential for change affect trading now? Likely not; this rally may falter if Bitcoin dips significantly below recent inflow levels. However, those believing Bitcoin will remain solely a speculative asset must now consider why a Swiss tax office is becoming more open to blockchain, unlike many G20 treasuries.

For Lugano, the plan is clear. “Plan ₿ unites the builders and thinkers, translating decentralization into reality,” Ardoino stated. The city appears more focused on practical outcomes: ensuring merchants get paid and taxes are collected, all while providing a more economical alternative to conventional payment methods. In simpler terms, it’s about making everyday transactions easier—more receipts, less speculation.