El Salvador Is Building A Bitcoin City That Mines Crypto From A Volcano
By Ell Ko, 22 Nov 2021
Image via the Presidency of El Salvador
El Salvador is no stranger to cryptocurrency, with its government famously throwing its weight behind Bitcoin. With offering citizens the option to pay for their McDonald’s meal in Bitcoin and plans in place to start mining crypto from volcanoes, it’s safe to say there’s no going back.
Adding to the list of crypto-related innovations, the country is investing in is a whole new city. Yes, it’s based in Bitcoin. And yes, it’s called Bitcoin City.
According to president Nayib Bukele, speaking at Bitcoin Week, this new city will be located near a volcano along the Gulf of Fonseca, between La Unión and Conchagua. Of course, it’ll have its own geothermal power plant. Remember how they wanted to mine crypto from volcanoes? It’s all coming together.
CoinDesk reports that the city is planned to be a full metropolis with residential and commercial areas, an airport, and a port and rail service. Residents in nearby areas such as La Unión could travel to work there, too. The city will have no income, property, capital gains or payroll taxes.
And, of course, the city will be shaped like a coin. At the center of this giant coin, a plaza is planned to play host to a huge Bitcoin symbol.
Bukele also stated that El Salvador is planning on issuing a US$1 billion “bitcoin bond.” This is, according to the news outlet, “a tokenized financial instrument” that was developed by Blockstream. Of the billion, US$500 million will be put towards energy and bitcoin mining infrastructure, with the remaining half used to buy even more Bitcoin.
“This bond offering is something we think will be attractive to a wide range of investors ranging from cryptocurrency investors, investors seeking yield, HODLers, and ordinary people,” a press release writes. “We believe this bond has the potential to accelerate hyperbitcoinization and bring about a new financial system built on top of Bitcoin.”
Then, this acquired Bitcoin will essentially be stashed away for the next five years. According to Samson Mow, Blockstream’s chief strategy officer, this is in hopes that by taking that amount of it out of circulation, it’ll help to contribute to the appreciation of its value.
Mow also tells CoinDesk that by the time 10 years have elapsed, the annual percentage yield could reach 146%.
¡El Salvador será el primer país del mundo en tener una #BitcoinCity!— Casa Presidencial 🇸🇻 (@PresidenciaSV) November 21, 2021
Estará entre la ciudad de La Unión y Conchagua. Las personas podrán vivir en La Unión pero trabajar en la #BitcoinCity. Pronto empezarán a ver todos los beneficios, cuando el desarrollo y la inversión llegue. pic.twitter.com/21bx7Yc5aJ
[via Engadget, cover image via the Presidency of El Salvador]
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