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- 1 Pro-crypto country El Salvador was seeking to launch Bitcoin Bonds and finally got regulatory approval.
- 2 The approval came from El Salvador’s Digital Assets Commission, paving the way for a significant financial development in the country.
El Salvador’s eagerly awaited Bitcoin bonds, dubbed “Volcano Bonds,” have received regulatory approval, setting the stage for their launch in early 2024. The approval came from El Salvador’s Digital Assets Commission, paving the way for a significant financial development in the country.
According to a statement from The National Bitcoin Office (ONBTC) on December 11, the Volcano Bond is expected to make its debut during the first quarter of 2024. The announcement aligns with El Salvador’s pro-Bitcoin leader, Nayib Bukele, who shared the news on his social media, captioning it with, “Wen volcano bond.” Bukele also reshared multiple posts confirming the issuance of the bonds in Q1, 2024.
The journey towards the Volcano Bond began on January 11 when El Salvador enacted groundbreaking legislation, establishing the legal framework for the Bitcoin-backed bond. The primary objectives of the Volcano Bond include alleviating sovereign debt and financing the ambitious “Bitcoin City” project proposed by the country.
ONBTC disclosed that the bond issuance will take place on the Bitfinex Securities Platform, a registered trading site for blockchain-based equities and bonds operating in El Salvador. This move marks the initiation of Bitcoin-based capital markets within the country. The Volcano Bond is set to have a tenure of 10 years, offering an annual return of 6.5% to its holders.
El Salvador has recently taken significant strides in the Bitcoin sector, launching a massive 241-megawatt Bitcoin mining project valued at $1 billion. This initiative, formed through a collaboration with Luxor Technology, harnesses the country’s volcanic resources, with the Conchagua volcano powering the mining operations.
Bitcoin Bond Took a Long Time to Appear
The regulatory approval of the Volcano Bond comes after nearly 21 months since the initial announcement by the country’s former finance minister, Alejandro Zelaya, who had projected a mid-March 2022 launch.
The legislative support for this groundbreaking financial move was evident, with 62 legislators voting in favor and 16 opposing the law. The law, officially passed in January 2021, demonstrates the government’s commitment to embracing innovative financial instruments, positioning El Salvador as a pioneer in the realm of Bitcoin-based finance.
This approval follows another significant Bitcoin-focused initiative by El Salvador, wherein the country introduced the “Freedom VISA” program. This program offers residency to a maximum of 1,000 individuals annually who invest a minimum of $1 million in either bitcoin or tether (USDT) stablecoins.
These recent moves underscore El Salvador’s determination to integrate Bitcoin into its economic landscape, signaling a bold and dynamic approach to cryptocurrency adoption on a national scale.
The Central American country has been bullish on cryptocurrency and among the front runners to accept it. Top leadership of the country, for instance President Bukele, is bullish on Bitcoin. El Salvador is among the top holders of the BTC and recently saw a profit of over $3 Million during a recent short rally.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
