El Salvador plans to construct a Bitcoin City

bitcoin covered in black crystals

In June 2021, El Salvador became the first country to adopt Bitcoin as a national currency.

The country’s president Nayib Bukele announced El Salvador plans to construct a Bitcoin City in 2022, near the Conchagua volcano. The city will have no taxes except a 10% value-added tax to fund city construction and services.

The Central American country also plans to sell $1 billion US dollar-denominated 10-year bonds with a coupon of 6.5% in partnership with Blockstream, a digital assets infrastructure company. Half of the funds will be used to buy bitcoin, while the other half will fund infrastructure and Bitcoin mining powered by geothermal energy.

According to Samson Mow, Chief Strategy Officer at Blockstream, forecasting Bitcoin will hit the $1 million mark within five years. He said the lockup period on the bonds is designed to take $500 million in Bitcoin out of the market for five years, adding to their scarcity and value.

“The first countries that do this will have a massive advantage. This is the beginning of nation-state Bitcoin FOMO” said Samson Mow.

Read more on: Market Watch

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