El Salvadorian president Nayib Bukele recently announced plans to build the world’s first “Bitcoin City” initially financed by bitcoin-backed bonds, as his government steps up efforts to generate investment in his country through cryptocurrencies.
Bukele announced that the planned city in the eastern region of La Union will draw geothermal energy from a volcano and will be almost tax free, with the exception of VAT.
“Invest here and make all the money you want. “This is a fully ecological city that works and is energized by a volcano,” Bukele said in English while speaking at a Bitcoin event in the resort town of Mizata, dressed all in white and wearing an upside-down baseball cap.
50% of the VAT collected will be used to finance the bonds issued for the construction of the city, while the other half will be used for services like garbage collection.
Bukele predicts public infrastructure spending of more than 300,000 Bitcoins, with the Latin American nation planning to issue its first bonds by 2022 or in 60 days.
Last September, El Salvador became the first nation in the world to introduce Bitcoin as legal tender.
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