El Salvador continues to make history with its adoption of bitcoin, with the latest initiative being the announcement of an entire city focused on the primary cryptocurrency.
The nation plans to put this plan into action through mining-backed volcanic bonds worth a total of $ 1 billion. While this may seem innovative and surprising to some, one person - Max Keizer - was actually the one who pitched the idea the first few months ago.
The Bitcoin passages of El Salvador
It was June 2021 when the small Central American country shocked the world by announcing its intention to adopt bitcoin as legal tender. Somehow predictably, global organizations like the IMF, with which El Salvador was arguing over a nearly $ 1 billion program, have criticized President Nayib Bukele and his unorthodox approach.
Some locals also encountered problems with the bill and took to the streets to protest against it. However, President Bukele and his administration did not hold back, and bitcoin effectively became a fiat currency within the nation in early September 2021.
El Salvador has started buying bitcoin, especially during some price drops, has started mining it using excess volcano energy, and plans to use the proceeds from BTC's price appreciation to build hospitals and pet schools.
While all of this might sound like a lot, bearing in mind that they leaked in just a few months, the country took it one step further over the weekend. announcing a Bitcoin City.
As President Bukele explained, the city will be circular and "have everything", from an airport and port to residential and commercial areas. There will be no tax, except value added tax (VAT).
The funding will come from $ 1 billion of volcano-backed bonds, 50% of which the country will use to buy more BTC and the rest will go to local infrastructure and mining. After five years, the government will start selling BTC gradually, which is expected to increase the annual percentage return for investors from 6,5% to single-digit, at least according to Blockstream's Samson Mow.
Keiser's idea?
The idea of volcano-backed bitcoin bonds is certainly a world first and can trace its origins to a June Twitter post from popular BTC backer - Max Keizer.
When the country had just announced its initial intentions to legalize cryptocurrency, the host of the Keizer Report wrote, "I'm sure the Bitcoiners can arrange a fallback on a $ 1 billion loan for El Salvador," so the country can stop relying on the IMF (in other words, of course).
Now that this idea is about to become a reality, many cryptocurrency insiders and even President Bukele himself have outlined Keizer and his contribution.
Explaining his vision, Keizer said that because bitcoin operates as "perfect money," which is "non-confiscable, unchangeable, and uncensored," it builds trust in leaders like President Bukele to "dream big."
He described El Salvador as a "wildly energetic" country where "the surf, the sun, the jungle and the volcanoes create endless possibilities".
“When you connect the dream of a visionary president to the cosmic power of volcanoes to bring the perfect Bitcoin money to millions of people without fear, the future is rewritten in the image of Bitcoin and the future is relentlessly optimistic. Not just for El Salvador, but for the whole world ”. - concluded Keizer.
