El Salvador has also established a legal framework to govern other cryptocurrencies aside from Bitcoin.
Bitfinex crypto exchange will be the provider of these Volcano Bonds
Photo Credit: Twitter/ PresidenciaSV
El Salvador has legally welcomed Bitcoin bonds as proposed by President Nayib Bukele, the President of the central American nation. Passed on Wednesday, ‘Volcanic Bonds' would allow El Salvador to gather capital to pay debts for the country, while also bringing in contribution for Bukele's ambitious special economic zone called the ‘Bitcoin City', via ‘Volcano Tokens'. El Salvador aims at raising $1 billion (roughly Rs. 8,172 crore) via Volcano Bonds.
With a minimum investment of $100 (roughly Rs. 8,170), El Salvador residents will be able to enter Volcano Bonds — that will add to the nation's economy. Any appreciation in Bitcoin's values will be shared with the bond holders.
In totality, El Salvador aims at raising $500 million (roughly Rs. 4,084 million) to fund Bitcoin City's infrastructure, and an equal amount to purchase Bitcoin for the government's treasury.
The Bitcoin Office, that is overseen by the Salvadoran authorities, posted more details about the newly passed law on Twitter.
The domestic securities law, that had been making the rounds in the Salvadoran parliament for a while now, received 62 votes from legislators.
The country has also established a legal framework to govern other cryptocurrencies apart from Bitcoin.
Bukele, the pro-crypto Salvadoran President welcomed the much-awaited decision, that is expected to drive more engagement with crypto assets by the masses.
El Salvador has chosen crypto exchange Bitfinex as the provider of these Volcano Bonds.
“This paves the way for more innovative financial solutions to meet the country's needs, including the forthcoming Volcano Token. This is a monumental achievement that will surely become part of history as El Salvador takes sovereignty over its financial future. Bitfinex's role as the technology provider for El Salvador's Volcano Token underlines our commitment to financial freedom and Bitcoin adoption,” the exchange owned and operated by iFinex stated in a post.
Bukele aims to power the tax-free Bitcoin City with the geothermal energy extracted from a regional volcano, that gives ‘Volcano Tokens' their name.
Such is the support for BTC from El Salvador, that its Miss Universe 2023 representative, actually walked the stage on Thursday, January 12, in a golden coloured Bitcoin-inspired ensemble.
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