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HomeLaw & PoliticsVolcano Bonds may take longer to launch in El Salvador

Volcano Bonds may take longer to launch in El Salvador

El Salvador appears to have postponed the debut of the so-called volcano bonds due to a lack of formal notifications. Alejandro Zelaya, the Salvadoran finance minister, had previously assured the public that the project would begin on March 20. El Salvador’s finance minister had indicated again on Friday on a local TV show that the introduction of so-called “volcano bonds” will take place between March 15 and 20 – the same dates he stated during his previous TV appearance in February. Even so, this time Zelaya listed the world’s fragile political climate as one of the variables that could affect the intended timeline.

El Salvador’s president, Nayib Bukele, proposed a coin-shaped “Bitcoin city” at the base of the Conchagua volcano in November 2021. According to Bukele’s concept, the creation of this new town, complete with crypto mining operations and low taxes, would be financed by the issuing of $1 billion in bonds. These bonds, dubbed “Bitcoin bonds” or “Volcano Bonds,” are expected to last 10 years and yield a 6.5 percent annual interest rate to their investors.

In December 2021, Samson Mow, the chief strategy officer of Blockstream, El-bond Salvador’s launch partner, announced that the platform had already collected $300 million in “soft commitments,” largely from “Bitfinex whales.” Fernando Nikolic, Blockstream’s marketing director, stated that the business would make an announcement in Q1 2022.

According to the Financial Times, the essential legislation to start the bond sale has yet to pass through the Salvadoran legislature.

Read more: El Salvador’s President Nayib Bukele is betting $1 Billion on Bitcoin

Kunal Krishan
Kunal Krishan
Kunal is an investment space writer who firmly believes investment is something which should not be a choice but a part of everyone's life.
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