El Salvador continues to lead the Bitcoin (BTC) adoption campaign while President Nayib Bukele announces the launch of Bitcoin City, which will initially be funded by $ 1 billion Bitcoin bonds.
The initiative was first announced by Bukele at El Salvador’s Bitcoin Week conference, which sought to celebrate Bitcoin’s mainstream adoption in the country and increase citizen participation.
“I thought we had to make a big announcement about this #BitcoinWeek. So today I want to announce that we are going to build the first one #BitcoinCity“, President @nayib Se. pic.twitter.com/7yHQLyIjBx
̵[ads1]1; The Presidential House (@PresidenciaSV) November 21, 2021
In Bukele’s words:
«In #BitcoinCity we want digital and technological education. Geothermal energy for the whole city and efficient and sustainable public transport ”
The development of Bitcoin City will see proactive involvement of prominent crypto companies including cryptocurrency exchange Bitfinex and Adam Backs Blockstream. According to Bitfinex CTO Bitfinex Paolo Ardoino, the exchange will support El Salvador’s Bitcoin City initiative by launching a securities platform to hold the 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 envisions Bitcoin City becoming a fully functional city with residential areas, shopping malls, restaurants, a port, “everything around Bitcoin.” In addition, residents are only charged VAT (VAT), which according to Bukele will be used to pay the municipality’s bonds, and the rest for public infrastructure and urban maintenance.
The conference was attended by Blockstream’s security chief Samson Mao clarified the opportunity to raise $ 1 billion in Bitcoin bonds:
“With Bitfinex, they have a lot of whales. I see no problem filling up a $ 1 billion bond.”
Mao also informed residents that $ 500 million worth of Bitcoin bonds will be subject to a five-year lock-in period, effectively removing the invested capital from global circulation. In addition, the entrepreneur explained how a 10-fold increase in similar initiatives from other countries will eventually take half of Bitcoin’s market value of 21 million out of circulation.
Related: El Salvador will build 20 ‘Bitcoin schools’ with profits from the Bitcoin Trust
Right after Bitcoin’s mainstream adoption, the El Salvador government has reinvested unrealized gains in various infrastructure development projects.
In early November, Bukele announced that the profits from the state’s Bitcoin Trust account will be used to build 20 new schools:
“When this project was started, we had not made that much money in FIDEBITCOIN [state BTC Trust account] as we have made now. So we have decided to create the first 20 Bitcoin schools. “
In mid-October, the El Salvador government reinvested $ 4 million from the profits of their Bitcoin Trust to build a new veterinary hospital in the capital, San Salvador.