El Salvador to build first “Bitcoin City”

El Salvador to build first “Bitcoin City”

El Salvador President Nayib Bukele has announced the first-ever “Bitcoin City” building. The announcement was set out at a gathering of bitcoin supporters. Bukele said in 2022, a bond offering would take place entirely in bitcoin, 60 days after construction would begin. 

Where will Bitcoin city be located?

The “Bitcoin City” will be near the Conchagua volcano. It will give power to both the city and the bitcoin mining, taking advantage of its geothermal energy. There is already a government-run pilot project using geothermal energy to mine Bitcoin.

The location of the bitcoin city sits in Southeastern El Salvador on the Gulf of Fonseca.

What will it include?

The only tax collected from the new bitcoin city will be the value-added tax. Half of the amount will pay for municipal bonds and the rest for municipal infrastructure and maintenance. Bukele mentioned that there would be no property, income, municipal taxes, and zero carbon dioxide emissions. 

The city will attract foreign investment. There would be malls, restaurants, a port, an opportunity for digital education, technology, and public transportation in the area. The government has backed Bitcoin with a $150 million fund. In addition, they are offering $30 in credit to individuals using the digital wallet to encourage Salvadorans to involve themselves. Therefore, critics have cautioned that the currency’s lack of transparency might bring forth criminal activity to the country. In addition, the digital currency’s dramatic price swings can put people who own it in danger.

Earlier this year, voters gave the president’s party control of both houses of Congress. The new lawmakers replaced members of the Supreme Court’s constitutional chamber and the attorney general. In the end, Bukele’s party was in control of the executive and legislative branches.

The US government will redirect aid from official agencies to civil society organizations in response. Bukele submitted a bill to Congress this month requiring organizations that receive foreign funds to register as foreign agents.

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El Salvador to build first “Bitcoin City”

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