Bermuda’s official currency is the Bermuda Dollar (BMD), used in the British territory known for its beautiful beaches and financial sector.

Closely tied to the US Dollar, the BMD is essential for the local economy, particularly in tourism and international business.

Read to know more about the history, currency exchange rate, and the notes and coins of this great country.

What is the Bermuda Dollar (BMD)

BMD stands for the Bermudian Dollar, which is the official currency of Bermuda. The Bermudian dollar is divided into 100 cents, just like the US dollar.

The Bermuda Dollar (BMD) serves as the official currency of Bermuda, a British Overseas Territory in the North Atlantic Ocean. Residents and visitors use the Bermuda Dollar for all transactions within the country, including purchasing goods, paying bills, and exchanging money.

It’s usually shown as BD$ to help distinguish it from other dollar-based currencies, like the US Dollar. The BD$ symbol helps avoid confusion when dealing with different currencies that also use the dollar sign.

History of the Bermuda Dollar

The Bermuda Dollar (BMD) was introduced in 1970, replacing the Bermuda Pound, which had been in use before then. 

Before this, Bermuda followed the British system, using the British Pound as its official currency due to its colonial ties to the UK. 

The shift to the Bermuda Dollar was part of a broader effort to update and modernize Bermuda’s financial system, making it more efficient and practical. 

Another key reason for the introduction of the Bermuda Dollar was the strong economic relationship Bermuda had with the United States, especially in terms of trade and tourism. 

By adopting a new dollar-based currency, Bermuda positioned itself to be more aligned with its largest economic partner, making financial transactions smoother and more convenient.

Exchange Rate with the US Dollar

One key thing about the Bermuda Dollar is that its value is pegged to the US Dollar at a fixed rate of:

• 1 BMD = 1 USD

This means that 1 Bermuda Dollar always equals 1 US Dollar, making the two currencies interchangeable in Bermuda.

Banknotes of the Bermuda Dollar

The Bermuda Dollar comes in various banknotes, each with its color and design. These are the banknotes you’ll find,

• BMD 2: This note is blue and features local symbols and images from Bermuda.
• BMD 5: The $5 bill is pink, representing Bermuda’s culture and landmarks.
• BMD 10: This note is green and showcases important Bermudian symbols.
• BMD 20: This bill is purple and larger than the lower denominations.
• BMD 50: The $50 note is orange, and used for bigger transactions.
• BMD 100: This note is red, the highest denomination in the Bermuda Dollar series.

Coins of the Bermuda Dollar

In addition to banknotes, Bermuda also has coins for smaller amounts. These include 1 cent, 5 cents, 10 cents, 25 cents, 50 cents, BMD 1 coin. People use the coins for everyday small purchases, and manufacturers typically make them from metals like copper and nickel.

Where can you use the Bermuda Dollar?

You can use the Bermuda Dollar exclusively in Bermuda. Other countries do not recognize or accept it.

However, since the Bermuda Dollar is pegged to the US Dollar at a 1:1 ratio, US Dollars are widely accepted throughout Bermuda. 

This means that if you’re a tourist or visitor in Bermuda, you can use US Dollars just as easily as Bermuda Dollars to pay for goods and services, as the value is the same. 

While Bermuda accepts US currency, Bermuda Dollars can’t be used when you leave the island, making them specific to the local economy.

Why the Bermuda Dollar is Pegged to the US Dollar

The Bermuda Dollar is pegged to the US Dollar because Bermuda’s economy heavily relies on tourism, particularly from American tourists. Pegging the currency at a 1:1 exchange rate with the US Dollar eliminates the need for complicated currency conversions and protects Bermuda from exchange rate fluctuations. 

This makes it much easier for both tourists and local businesses, ensuring stable pricing and reducing the risks that come with changing currency values. 

For tourists, especially from the United States, this means they don’t have to worry about exchange rates and can use US Dollars in Bermuda without any issues. 

The peg ensures economic stability for local businesses, facilitating smooth financial interactions with many American visitors and businesses in Bermuda.

How much is $1 US in Bermuda?

In Bermuda, $1 US Dollar is equal to BMD 1.00000. This is because the Bermuda Dollar (BMD) is pegged to the US Dollar at a 1:1 ratio. 

So, if you have US Dollars, you can use them in Bermuda as if they were Bermuda Dollars without worrying about exchange rates.

Is Bermuda’s Currency the Same as the US?

While the Bermuda Dollar and the US Dollar have the same value due to the 1:1 peg, they are not the same currency. 

The Bermuda Dollar (BMD) is the official currency of Bermuda and is used only on the island. In contrast, the US Dollar (USD) is used in the United States and internationally. 

Visitors in Bermuda can use either US Dollars or Bermuda Dollars, as the island widely accepts both currencies.

Where do people use the Bermuda Dollar?

The Bermuda Dollar serves as the exclusive currency in Bermuda. Other countries do not recognize or accept it.

The Bermuda Dollar’s 1:1 peg to the US Dollar leads to widespread acceptance of US Dollars in Bermuda.

Tourists in Bermuda can use US Dollars or Bermuda Dollars interchangeably to pay for goods and services, as their values are the same.

While Bermuda accepts US currency, Bermuda Dollars can’t be used when you leave the island, making them specific to the local economy.

Why the Bermuda Dollar is Pegged to the US Dollar

The Bermuda Dollar is pegged to the US Dollar because Bermuda’s economy heavily relies on tourism, particularly from American tourists. 

Pegging the currency at a 1:1 exchange rate with the US Dollar eliminates the need for complicated currency conversions and protects Bermuda from exchange rate fluctuations. 

This makes it much easier for both tourists and local businesses, ensuring stable pricing and reducing the risks that come with changing currency values. 

For tourists, especially from the United States, this means they don’t have to worry about exchange rates and can use US Dollars in Bermuda without any issues. 

Similarly, for local businesses, the peg helps maintain economic stability, ensuring smooth financial interactions with the large number of American visitors and businesses that engage with Bermuda.

Is Bermuda’s Currency the Same as the US?

No, the Bermuda Dollar (BMD) is not the same as the US Dollar (USD), but they are pegged at a 1:1 exchange rate. 

This means that $1 Bermuda Dollar equals $1 US Dollar. While the value is the same, the Bermuda Dollar is only used in Bermuda, and it has its coins and banknotes, distinct from the US currency.

What Currency Does Bermuda Spend?

Bermuda uses the Bermuda Dollar (BMD) as its official currency. However, US Dollars are also widely accepted throughout the country. 

So, even if you have Bermuda Dollars or US Dollars, you can spend them both in Bermuda without any issues.

Conclusion

The Bermuda Dollar (BMD) is an essential part of Bermuda’s economy and daily life, providing a stable and convenient means of exchange for both locals and tourists. 

Introduced in 1970 to replace the Bermuda Pound, the Bermudian dollar aligns with the US dollar due to close economic ties.

Pegged to the US dollar, it maintains a unique identity with its banknotes and coins, letting visitors enjoy their stay without worrying about exchange rates.