El Salvador's President Nayib Bukele has announced that his government plans to build an ocean 'Bitcoin City 'at the base of a volcano.
Bukele hopes to put the small Central American nation on the map as a new tax haven, to rival countries like the Caymans, but with the added selling point that trade can be done exclusively in untraceable cryptocurrencies, which has been legal currency. since then. September.
While some critics fear that the country's adoption of Bitcoin could spur more criminal activity, the president hopes to boost the country's economy with investor-friendly Bitcoin City.
The Salvadoran president made the announcement at a Bitcoin conference on Saturday night.
A bond offering would come in 2022 entirely in Bitcoin, Bukele said, with his baseball cap turned backwards. And 60 days after the financing was ready, construction would begin.
The city will be built near the Conchagua volcano to harness geothermal energy to power both the city and Bitcoin mining, solving complex, energy-intensive mathematical calculations day and night to verify currency transactions.
The government is already running a pilot Bitcoin mining venture at another geothermal power plant next to the Tecapa volcano.
The Conchagua volcano, on the seashore, is located in southeastern El Salvador in the Gulf of Fonseca.
El Salvador's President Nayib Bukele speaks at the closing party of 'Bitcoin Week' in Toetepeque, El Salvador, where he announced his government's plans to build the world's first 'Bitcoin City'.
El Salvador's President Nayib Bukele announced his government's plans to build a seaside 'Bitcoin City' at the base of the Conchagua volcano (pictured), using its geothermal energy to power cryptocurrency mining.
The 'Bitcoin City' will be built along the Atlantic coast of El Salvador (map in the photo), near the Conchagua volcano to attract investors with its low local taxes.
A mayoral police officer patrols near the Chivo digital wallet machine, which will exchange cash for cryptocurrencies Bitcoin, right, at Plaza de Las Amรฉricas in San Salvador, El Salvador, on September 7, 2021, the day that all businesses should start accepting Bitcoin payments, except those that lack the technology to do so
The government will provide land and infrastructure and work to attract investors.
The only tax that will be collected there will be the value added tax, half of which will be used to pay municipal bonds and the rest for municipal infrastructure and maintenance.
Bukele said there would be no property, income or municipal taxes and that the city would have zero carbon dioxide emissions.
The city would be built thinking of attracting foreign investment. There would be residential areas, shopping centers, restaurants and a port, Bukele said. The president spoke about digital education, technology and sustainable public transport.
'Invest here and earn all the money you want,' Bukele told the crowd in English at the closing of the Latin American Bitcoin and Blockchain Conference taking place in El Salvador.
El Salvador's President Nayib Bukele plans to encourage the use of Bitcoin as legal tender, it will cause taxes in the Central American country to plummet
Protesters take part in a protest against the Bitcoin Law in September this year in San Salvador, El Salvador. El Salvador became the first country to accept Bitcoin currency as legal tender, after the 'Bitcoin Law' (Bitcoin Law) came into effect two months ago.
People protested against the policies of President Nayib Bukele on Independence Day in San Salvador, September 15. Thousands of Salvadorans demonstrated to demand that President Nayib Bukele respect the separation of powers and reject the introduction of bitcoin as legal tender, just after the country commemorated the bicentennial. of its independence
Salvadoran veterans of the army and the guerrillas, march to protest against the economic measures adopted by the government, in San Salvador, in August of this year. Social unrest prevails when citizens accuse the government of poor information related to Bitcoin and a sense of mistrust in using the currency.
Bitcoin has been legal tender alongside the US dollar since September 7 after Bukele announced at a Bitcoin conference in Miami through a video message that El Salvador would be the first country to convert the cryptocurrency to currency. legal course.
The government backs Bitcoin with a fund of 150 million dollars. To encourage Salvadorans to use it, the government offered a $ 30 credit to those who use its digital wallet.
Critics have warned that the currency's lack of transparency could attract more criminal activity to the country and that sudden changes in the value of the digital currency would pose a risk to those who own it.
Bitcoin was originally created to operate outside of government-controlled financial systems and Bukele says it will help attract foreign investment to El Salvador and make it cheaper for Salvadorans living abroad to send money to their families.
Concern among the Salvadoran opposition and outside observers has increased this year as Bukele has moved to consolidate power.
Voters gave control of congress to the highly popular president's party earlier this year. The new legislators immediately replaced the members of the constitutional chamber of the Supreme Court and the attorney general, leaving Bukele's party firmly in control of the other branches of government.
On June 5, Bukele declared that Bitcoin would be legally considered legal tender in the country. A few months later, the Bitcoin Law (Bitcoin Law) went into effect on September 7, and since then, businesses have to accept Bitcoin for all payments.
In response to Bukele's consolidation of power, the US government said it would shift its help from government agencies to civil society organizations.
This month, Bukele sent a proposal to Congress that would require organizations that receive foreign funding to register as foreign agents.
