Home News El Salvador seems to delay its ‘volcano bonds’ launch

El Salvador seems to delay its ‘volcano bonds’ launch


El Salvador’s government appears to have postponed the introduction of the so-called “volcano bonds”. Because no official statements are available. Earlier, Alejandro Zelaya, the Salvadoran finance minister, had assured the public that the project would begin on March 20.

El Salvador’s finance minister confirmed again on Friday on a local TV show that the issue of so-called “volcano bonds” will take place between March 15 and 20 – the same dates as in February. Nonetheless, this time Zelaya identified the world’s unpredictable political climate as one of the elements that could affect the intended timing.

El Salvador’s president, Nayib Bukele, said in November 2021 that a coin-shaped “Bitcoin city” would be built at the base of the Conchagua volcano. According to Bukele’s plan, a $1 billion bond would be issued. In order to fund the creation of this new town with crypto mining activities and low taxes. These bonds, dubbed “Bitcoin bonds” or “volcano bonds,” designed to survive 10 years. And to provide a 6.5% yearly interest rate to its owners.

“Soft pledges”

El-bond Salvador’s launch partner, Blockstream, stated in December 2021 that the platform had already collected $300 million in “soft pledges,” largely from “Bitfinex whales.”

The essential legislation to start the bond sale has yet to clear the Salvadoran parliament, according to the Financial Times.

Blockstream, on the other hand, is unaware of the new launch dates. Because it does not engage directly with the government of El Salvador to provide EBB1.

“The issuance EBB1 will be on the Liquid Network, which run by people from throughout the world. Blockstream is merely a service provider of technology. So, when they’re ready, they’ll be able to issue the bond on Liquid just like everyone else.”

Meanwhile, El Salvador’s neighbouring country, Honduras, may follow El Salvador’s lead. And become the world’s second country to accept Bitcoin (BTC) as a payment mechanism. That, according to some accounts, stems from Honduran President Xiomara Castro’s remark that El Salvador should not be the only country “escaping dollar hegemony.”

Fitch lowers El Salvador rating due to Bitcoin adoption

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