At the Bitcoin Week conference, El Salvador’s President Nayib Bukele announced the construction of Bitcoin City and the issuance of $1 billion in BTC-backed bonds.
Salvadoran authorities have announced plans to build the world’s first cryptocurrency city, Bitcoin City. It will be located along the Gulf of Fonseca. The city will be powered by the Conchagua volcano, near which a geothermal power plant will be built. The volcano’s energy will also be used for BTC mining.
Bitcoin City will be a full-fledged metropolis with all the necessary infrastructure, which will include:
- train station;
- an exhibition complex in the form of a giant “B” symbol;
- residential and commercial areas.
It is planned to create a special economic zone in the city. There will not be levied any taxes except for value added tax (VAT).
Financial Backing for the Project
The project will be financed by issuing 10-year tokenized bonds worth a total of $1 billion. iFinex and Blockstream will partner with the government of El Salvador.
Bitfinex Securities, a division of iFinex, will create the platform for the bond issue and help develop the regulatory framework for the project. Blockstream will develop and model the bonds. The assets are planned to be issued on the Liquid Network.
The funds raised will be divided into two parts: one half will be invested in the purchase of BTC for the state trust for five years, and the other half will be invested in the city’s infrastructure and organization of BTC mining. As of November 22, 2021, the El Salvador State’s Bitcoin Trust has 1120 BTC in its account.