It was back on June 5 when El Salvador’s president Nayib Bukele declared that Bitcoin would soon become a legal tender in the country. Just a few days later, the law was passed, taking effect from September 7. Today, Bukele wants to build a Bitcoin city.
Harnessing the Power of Cryptocurrency
According to president Bukele, the Bitcoin city will be funded by Bitcoin-backed bonds and will help promote investment in the country.
The city is planned to be built in the eastern region of La Union. It would get the thermal power from a volcano and would not impose any taxes other than value-added tax (VAT). The city will be completely ecological as well.
Bukele invited people to invest and earn as much money as they wish and improve their portfolio. The 50% of VAT payments will be used to fund the bonds and further build the city. The other half would pay for city services like garbage collection.
According to the estimates, the public infrastructure will cost about 300,000 bitcoins.
El Salvador plans to issue initial bonds in 2022. After the five-year lock, El Salvador would also start selling some of the Bitcoin used in bonds to give investors additional “coupons.”
The value of cryptocurrency will continue to rise, and the leaders of El Salvador firmly believe this move would make the country a financial center of the world.