The government of El Salvador announced this Monday that it will issue bitcoin bonds in the first quarter of 2024, with whose funds it is planned to finance the construction of a city called “Bitcoin City” in the east of the country.
“The Volcano Bond has just received regulatory approval from the Digital Assets Commission. We anticipate that the bond will be issued during the first quarter of 2024,” the government’s Bitcoin National Office, aimed at managing all bitcoin-related projects, said in its X account.
On September 7, 2021, bitcoin began to circulate legally in the country on par with the US dollar at the behest of President Nayib Bukele. The dollar has had legal tender in the Salvadoran economy since 2001.
With bitcoin, Bukele sought to have remittances from abroad flow at a lower cost, and for Salvadorans, 70% of whom were outside the financial system, to become banked en masse. However, according to polls released in mid-year, 71% of Salvadorans consider that the cryptocurrency “has not helped at all” to improve their family economic situation.
On November 20, 2021, Bukele announced a plan to build a city called “Bitcoin City” in the east of the country, near the Gulf of Fonseca in the Pacific Ocean, which would operate on the thermal energy of a volcano.
The construction of that city would be done with part of the at least $1 billion in volcano bonds that was planned to be issued, the ruler said at that time. Bukele, who is seeking re-election in the February 2024 elections, has had a license since this month to dedicate himself to his candidacy.
In a brief message on his X account, the president published “When will the volcano bonds be issued?”, without revealing when the issue would be made and whether in the end it would be for $1 billion.
The Salvadoran government has publicly said it has purchased 2,381 bitcoins, without revealing the figures invested. The last purchase was made on July 1, 2022 when it acquired 80 bitcoins.
Bukele announced that El Salvador would buy one bitcoin daily from November 17, 2021.
