El Salvador announced Monday it will issue bitcoin bonds in the first quarter of 2024, the proceeds of which are expected to finance the construction of a “Bitcoin City” powered by a volcano.
“The Volcano Bond has just received regulatory approval from the Digital Assets Commission (CNAD). We anticipate the bond will be issued during the first quarter of 2024,” the National Bitcoin Office, which manages all cryptocurrency-related projects, said on X.
Bitcoin became a legal currency in El Salvador, alongside the US dollar, in 2021 at the behest of President Nayib Bukele. The dollar has been legal tender in the Salvadoran economy since 2001.
With bitcoin, Bukele sought to make it easier, and cheaper, for Salvadorans to receive remittances and to provide financial services access to the 70 percent of people with no bank account.
But a poll conducted in May by the Central American University found that 71 percent believed the cryptocurrency “has in no way helped to improve their family economic situation.”
Also in 2021, Bukele announced a plan to build a “Bitcoin City” in the east of the country, which would be powered by thermal energy from a volcano.
The city would be built in part with at least $1 billion in volcano bonds that were to be issued, Bukele said at the time.
The Salvadoran government said it has bought 2,381 bitcoins.
The last purchase was made in July 2022 when it bought 80 bitcoins.
Bukele announced that El Salvador would buy one bitcoin a day from 17 November 2022. The government has not disclosed whether this has been done.