The city of Lugano, the economic capital of Italian-speaking southern Switzerland, is adopting cryptocurrencies for tax payments as part of a new collaboration with the provider of the Tether (USDT) stablecoin.

Tether Operations Limited, the blockchain-based platform that powers USDT, the world’s largest stablecoin by market capitalization, has signed a partnership with the administration of Lugano, according to a joint announcement on Thursday.

Tether and the city administration have established a Center of Excellence for Blockchain Adoption with the goal of becoming a major European blockchain hub.

The collaboration intends to demonstrate the real-world use cases of blockchain by applying it practically in the local community, including adopting cryptocurrency payments and experimentation of blockchain solutions on an urban scale. Tether and the city specifically plan to implement the Lightning Network, a second layer added to Bitcoin’s (BTC) blockchain, to overcome the scalability obstacles of its crypto city infrastructure.

Lugano aims to scale its efforts to enable citizens and companies to pay their taxes in cryptocurrency in the near future, pending several formal approvals and infrastructure projects. The ultimate goal is to accept crypto for payment of all goods and services, equating it with a fiat currency, the announcement notes.

As part of the partnership, Tether will also create a multi-million dollar fund to help finance blockchain-based startups and blockchain services in the region. Additionally, Tether will contribute its expertise and support to the…

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