El Salvador Plans World's First Bitcoin City
- El Salvador plans to construct a “Bitcoin City” near a volcano that will be funded by the cryptocurrency, the country’s President Nayib Bukele announced recently.
- The city will have residential and commercial areas, services, entertainment, restaurants and an airport.
- El Salvador also plans to raise about $1 billion via a “Bitcoin Bond” in partnership with Blockstream, a digital assets infrastructure company.
About Bitcoin city
- Bitcoin city, as planned by the El Salvador president, will be laid out in a circle (like a coin) and in the city center will be a plaza that will be host to a huge Bitcoin symbol, according to a report by Reuters.
- The city will be built near the Conchagua volcano to take advantage of the country’s geothermal energy— to power both the city and cryptocurrency mining —an energy consuming process of solving complex mathematical calculations day and night to verify and add crypto coins to the Blockchain network.
- According to Bukele, the residents of Bitcoin city won’t have to pay any income, property, capital gains or even payroll taxes. The city would be built with attracting foreign investment in mind.
- Bukele unveiled a $1 billion US “Bitcoin bond”—half of which ($500 millions) would be used to build energy and mining infrastructure, and the rest ($500 millions) will be used by the country to buy more Bitcoins.
- The issuance of these bonds will be managed by Blockstream, a Bitcoin services-focused company.
- The tokenised bond will be available to a number of users in the world that will have access to invest in small amounts as low as $100 dollars.
- Dividends will be paid easily to bondholders using tools deployed on top of the Liquid network.
- Dividends can be distributed to investors instantly, with built-in cryptography to maintain confidentiality.
- Bonds can be traded 24/7 with other assets like stablecoins, using protocols that help eliminate the need for trust as per the company.