El Salvador continues to spearhead the Bitcoin (BTC) adoption campaign when President Nayib Bukele announced the launch of Bitcoin City, which will initially be funded by $ 1 billion Bitcoin bonds.
The initiative was first announced by Bukele at Bitcoin Week in El Salvador, which aimed to celebrate the prevailing Bitcoin adoption in the country and increase citizen participation.
According to Bukele:
At #BitcoinCity we will have digital and technological education. geothermal energy for the whole city and efficient and sustainable public transport ”
Well-known crypto companies will actively participate in the development of Bitcoin City, including Bitfinex crypto exchange and Adam Backs Blockstream. According to Paolo Ardoino, CTO of Bitfinex Bitfinex, the exchange will support the Bitcoin City initiative in El Salvador by launching a securities platform to hold bitcoin bonds. he added:
“[The platform] will soon be home to many local and foreign digital asset offerings that develop new digital asset regulation for the country! El Salvador, Bitfinex and Blockstream are making history together.”
The president envisages that Bitcoin City will become a fully functional city with residential areas, shopping malls, restaurants, a port and “everything about Bitcoin”. In addition, residents are only subject to value added tax (VAT), which Bokele said will be used to pay municipal bonds, and the rest on public infrastructure and urban services.
At the conference, Samson Mao, Blockstream’s chief security officer, explained the possibility of acquiring a $ 1 billion bitcoin bond:
“They have a lot of whales with Bitfinex. I see no problem with the registration of the billion bond.”
Mao also informed residents that the $ 500 million Bitcoin bond would be subject to a five-year lockout period, which would effectively take the invested capital out of global circulation. In addition, the entrepreneur explained how a 10-fold increase in similar initiatives from other countries would eventually lead to the phasing out of half of the market value of 21 million Bitcoin.
RELATED: El Salvador Builds 20 “Bitcoin Schools” with Surplus Bitcoin Trust
Immediately after the massive introduction of bitcoin, the El Salvador government reinvested the unrealized revenues in several infrastructure projects.
In early November, Bukele announced that the profits from Bitcoin Trust’s government account would be used to build 20 new schools:
“When this project started, we did not make as much money from FIDEBITCOIN [BTC Trust State Account] as we do now. So we decided to create our first 20 bitcoin schools.”
In mid-October, the El Salvadoran government reinvested $ 4 million in profits from the bitcoin fund to build a new veterinary hospital in the country’s capital, San Salvador.