Thursday, January 20, 2022
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By Olivia Brooke
Published 31 mins ago Updated 31 mins ago

Bitcoin remains firmly at the center of the plans of Nayib Bukele, the president of El Salvador. The government of the Central American country will send about 20 bills to its Congress that will give legal backing to Bukele’s plan to issue Bitcoin Bonds.

Per a Reuters report, the Finance Minister of El Salvador, Alejandro Zeleya, stated that the bills will cover financial markets and investment in securities, especially those backed by crypto assets. However, he did not state when the draft bills would be handed to the lawmakers.

(This is) to provide a legal structure and legal certainty to everyone who buys the bitcoin bond, Zelaya said.

El Salvador first announced plans to issue Bitcoin bonds in November last year. The country hopes to raise $1 billion through the bond issuance to fund plans for the construction of a “Bitcoin-City,” as well as, fund further purchases of Bitcoin. The Bitcoin City will be constructed near a volcano to harness hydrothermal energy according to the plan. It will also be a fully-fledged metropolis with residential and commercial areas and will have no taxes except value-added tax (VAT). Construction is planned to begin in 2022.

El Salvador pushed on with its crypto plan despite criticisms

El Salvador made Bitcoin legal tender in September last year, allowing for its use as a parallel currency with the dollar. Since legalization, El Salvador has bought a total of 1370 Bitcoins to its treasury, scooping it up whenever there is a downward price correction in the market. It has also invested its gains from the investment in the construction of a hospital and plans to build several schools.

In the midst of this, there have been criticisms targeted at the move. Observers including the IMF, the World Bank, and the Bank of England have called the move a risk to the economy of the country. Within the country as well, several groups have opposed the adoption of Bitcoin as legal tender. Recently too, there have been complaints about Chivo wallet, the official Bitcoin wallet of the country. Citizens have noticed that Bitcoins have been disappearing from their wallets due to an unknown glitch.

However, the Bukele led government of the country is not relenting in its experiment with Bitcoin. Bukele even recently made some significant Bitcoin predictions for 2022 that state his confidence in El Salvador’s plans around Bitcoin. Two of the predictions he made were that the construction of Bitcoin City would commence this year and that the Bitcoin bonds or volcano bonds would be oversubscribed.

Additionally, he predicted that the price of Bitcoin would reach $100,000 even as two more countries elevate it to legal tender status and that Bitcoin would be a major issue in this year’s U.S. election.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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