El Salvador’s ‘Bitcoin City’

El Salvador’s ‘Bitcoin City’

Subject – IR

Context – El Salvador, the only country to recognise Bitcoin as a legal tender, is planning to build an entire city based on the largest crypto currency Bitcoin, President Nayib Bukele announced to a gathering of Bitcoin enthusiasts on Saturday at Bitcoin Week in El Salvador.

Concept –

• El Salvador, the only country to recognise Bitcoin as a legal tender, is planning to build an entire city based on the largest cryptocurrency Bitcoin.
• El Salvador’s “Bitcoin City” would be funded with the issuance of a $1 billion Bitcoin Bond. The city will be located along the Gulf of Fonseca near a volcano.

What is Bitcoin city? How will Salvadorans benefit?

• Bitcoin city, as planned by the El Salvador president, will be laid out in a circle (like a coin) and in the city center will be a plaza that will be host to a huge Bitcoin symbol, according to a report by Reuters.
• The city will be built near the Conchagua volcano to take advantage of the country’s geothermal energy— to power both the city and cryptocurrency mining —an energy consuming process of solving complex mathematical calculations day and night to verify and add crypto coins to the Blockchain network.
• It is worth noting that El Salvador is already running a pilot Bitcoin mining venture at another geothermal power plant beside the Tecapa volcano.
• According to Bukele, the residents of Bitcoin city won’t have to pay any income, property, capital gains or even payroll taxes. The city would be built with attracting foreign investment in mind.