El Salvador Makes Way For Bitcoin-Backed Bonds In Landmark Move
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In a landmark move, El Salvador has opened the doors for issuing a Bitcoin-backed bond called the “Volcano Bond.”
The legislation, called the “Digital Asset Issuance,” will also look to create a regulatory body and create a legal framework for digital assets operating in the country.
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A Landmark Legislation
The Central American country of El Salvador has passed a landmark judgment that will see the creation of the legal framework for a Bitcoin-backed bond, dubbed the “Volcano Bond.” The bond will be utilized to pay the country’s sovereign debt and fund the construction of a proposed “Bitcoin City.” The bill passed relatively easily in the assembly, seeing 62 votes for the proposal and 16 votes against it, and will soon be ratified by president Nayyib Bukele.
Bukele had announced in 2021 that El Salvador was planning on raising $1 billion through Bitcoin-backed bonds. The proposed paper began to be called “Volcano Bonds,” with the money to create a bitcoin mining industry that would rely solely on renewable energy sources, including energy from the country’s numerous active volcanoes. The country’s Bitcoin office announced the bill’s passage on 11th January 2023 on a Twitter thread.
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