President Nayib Bukele, of El Salvador, announced yesterday he would issue a $1 billion “Bitcoin Bond” to build the first Bitcoin City in the world. There would be no tax except VAT. The city will also not have any carbon emissions, as most of the power it uses comes from geothermal sources. El Salvador, which is a partner of Blockstream, will use Blockstream’s liquid network to issue the bond.
Bitcoin City announced in El Salvador
Nayib Bukele, El Salvador’s president, has taken the next steps to integrate Bitcoin into everyday life. At the close of Labitconf yesterday, Nayib Bukele (a Latam-based Bitcoin conference), he announced the next step in bitcoin integration: the construction of the world’s first Bitcoin City. This would be funded by the issuance $1 billion Bitcoin Bonds.
It would be found in the East of the country. The infrastructure will be run by geothermal energy. It would have no taxes and be free to its residents. Bukele said that this was the case:
You can make as much money here by investing. The volcano powers this fully-ecological city.
A value-added tax would be the only tax in the new city. This tax will pay for construction bonds, maintenance and improvements to the infrastructure. Bukele showed a model of Bitcoin City that features a central plaza containing the bitcoin symbol.
Blockstream and Bitfinex back you
Blockstream will manage the issuance of bonds. The tokenized bonds will be issued over Blockstream’s Liquid blockchain. This sidechain is a federated one. There will be two components to the goal of raising $1 billion. First, the first $500 million of that amount will go to buy bitcoins worth $500 million. The second $500 million is to fund bitcoin mining and infrastructure.
The tokenized bond will be available to a number of users in the world, that will have access to invest in small amounts of even $100 dollars, according to statements from Blockstream’s CSO Samson Mow. Utilizing tools on the Liquid network, bondholders can receive dividends easily.
Bitfinex will be able to organise the bond issuance. The new securities law must be approved by the country. Bukele’s party, New Ideas holds most of the legislative power. This is merely a formality to the Bitcoin City proposal.
What do you think about El Salvador’s Bitcoin City proposal and the bond issuance to fund it? Leave a comment below.
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