bitcoin: Driving to Bitcoin City: El Salvador drafts 20 bills for Bitcoin bonds

Synopsis

El Salvador’s government will establish the legal and financial framework for Volcano Bonds, a $1 billion Bitcoin bond issue

The country’s administration is creating 20 bills that would serve as a legal framework for them to move forward with plans to issue Bitcoin bonds

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New Delhi: In 2021, Latin American nation El Salvador, led by President Nayib Bukele, became the first country in the world to recognise Bitcoin as a legal tender.

The bills will now aid El Salvador’s government to establish the legal and financial framework for Volcano Bonds, a $1 billion Bitcoin bond issue.

The country’s administration is creating 20 bills that would serve as a legal framework for them to move forward with plans to issue Bitcoin bonds.
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According to the statements released by the Treasury Secretary, the laws would address regulations for issuing securities in cryptocurrency to assure the viability of Bitcoin bonds, which were suggested in November 2021.

Edul Patel, CEO and Co-founder, Mudrex, said that the government is planning to pass legislative bills, which would act as a legal framework providing legal certainty, and driving investors to subscribe to the bitcoin bonds.

Apart from the Bitcoin bonds, the government of El Salvador has said that Bitcoin bonds will fund the creation of the proposed Bitcoin City.

There are a lot of investors who want to get exposure to Bitcoin. Bitcoin bonds backed by a country are a much safer alternative to direct investment in Bitcoin, said Amit Nayak, CEO and Co-founder of Sahicoin.

According to the plans proposed by President Bukele the Bitcoin City will provide ‘digital and technology education, geothermal power for the entire city, and effective and reliable public transportation.’

The president has pledged to channelise $1 billion raised from the bond offering will be used to fund the Bitcoin City plan. These bonds come with a coupon rate of 6.5 per cent.

With Bitcoin City, El Salvador plans to usher in a new era of digital education, sustainable energy reserves, and green mining. El Salvador has announced this project, a few weeks ago, in the later end of 2021.

Market experts are calling the Bitcoin City project as a visionary step by the government of El Salvador which will be a paradigm shift towards the crypto regulations and legal framework.

Patel of Mudex said that it will act as a benchmark for other nations planning to implement regulatory guidelines around cryptocurrencies.

The timeline of setting up this fabled city is still under the wraps but the crypto space will transform into something more comprehensive, the experts say.

Echoing the similar views, Nayak said that he will be keenly watching how the plan will roll out. “Announcement of Bitcoin city will certainly attract more blockchain innovators, this could be a silicon valley of future making,” he adds.
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Updated: 01/06/2022 — 19:00