El Salvador President Nayib Bukele is at it again. He announced Saturday his plans to build "Bitcoin City" near a volcano in the Gulf of Fonseca with a $1 billion commitment to establishing crypto mining infrastructure and buying more Bitcoin.
This is Bukele's latest effort to make Bitcoin central to El Salvador's economy. He introduced a law that made the cryptocurrency legal tender in September, and in October, his plan to use volcanic energy to mine Bitcoin finally came to fruition.
El Salvador was also reportedly planning to make it so foreign investors won't have to pay taxes on profits earned via Bitcoin speculation—which is when someone buys some coins and then sells them for a higher price—to appeal to crypto enthusiasts.
CoinDesk reported that Bukele now wants to build "a full-fledged metropolis with residential and commercial areas, restaurants, an airport as well as a port and rail service" and has a massive statue of a Bitcoin symbol in the center plaza.
Bukele also said that "the city will have no income, property, capital gains or payroll taxes," according to the report, presumably because it will support itself via mining Bitcoin. (Although it's not clear how much it would have to mine to stay afloat.)
El Salvador will fund Bitcoin City by issuing a $1 billion "bitcoin bond" on the Liquid Network. The bond will be split down the middle, with $500 million being devoted to building out mining infrastructure and $500 million being used to purchase Bitcoin.
The bond will be issued via Blockstream, which said in a press release:
"We’ve been in talks with El Salvador for months and we’ve put in a massive amount of effort in designing and modeling the bonds. This bond offering is something we think will be attractive to a wide range of investors ranging from cryptocurrency investors, investors seeking yield, HODLers, and ordinary people. We believe this bond has the potential to accelerate hyperbitcoinization and bring about a new financial system built on top of Bitcoin."
El Salvador will hold on to that cryptocurrency for at least five years, at which point it will be sold and a dividend will be paid to bondholders. CoinDesk said Blockstream expects the price of Bitcoin to rise from $60,000 to about $1 million in that time.
So there we have it: In less than a year, El Salvador has made Bitcoin legal tender, committed to mining the cryptocurrency with volcanic energy, and revealed plans to build an entire city devoted to the coin. Never let it be said that 2021 was boring.
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Nathaniel Mott is a freelance news and features writer for Tom's Hardware US, covering breaking news, security, and the silliest aspects of the tech industry.
lets put our country economy on a poker bet...Reply
This has so many shades of Far Cry 6's Yara setting. Bukele is really just "El Presidente" Antón Castillo, right? Or maybe he's really Giancarlo Esposito!Reply
Somebody, please stop this man, before GPU price sky rocketed to absurdity, and we all back to pre-3dfx era.Reply
Hahahaha. When the volcano erupts the bitcoin will be safe in the metaverse.Reply
El Salvador Plans to Build a 'Bitcoin City' Near a VolcanoAnd it will do so near one of the country's volcanoesInteresting. Any word on whether they'll build it near a volcano?
I think I missed the part where it is demonstrated that we can convert energy from a volcano into electricity. I know there is extensive use of geothermal energy, particularly in Iceland, but I think the engineering to reliably harness the energy from a volcano has yet to be developed.Reply
That is, other than the secret lair of Dr. Evil. His lair was in a volcano where he was mining for "One million bitcoin!"
I hear there's a volcano, near a volcano, that's actually near a volcano! Volcano inception, man.Nolonar said:Interesting. Any word on whether they'll build it near a volcano?
The title says near a volcano. For those who thought El Salvador might build a city in Hawaii, or near a volcano somewhere else, the subtitle clarifies that El Salvador will build the city near a volcano in its own country.Nolonar said:Interesting. Any word on whether they'll build it near a volcano?
An underwater volcano would be ideal.Reply
Near limitless heat for converting to electricity and near limitless heat dissipation with miles of water above you.
I get where you're coming from, but BTC mining has long been unprofitable to mine on GPU. The one most popularly mined on a GPU rn, is Ethereumsamopa said:Somebody, please stop this man, before GPU price sky rocketed to absurdity, and we all back to pre-3dfx era.