El Salvador Approves Issuance of First Bitcoin Bonds

While El Salvador had made bitcoin (BTC) legal tender within its territory, the country was working on making financial instruments favorable to this policy available. The country has made progress in this direction, with the Digital Asset Committee (CNAD) having validated the issuance of the world’s first bitcoin (BTC) bonds.

A New Step for Bitcoin (BTC) on the Salvadoran Financial Market

El Salvador has taken a significant step in its quest for innovative financial instruments. Indeed, regulatory approval has been granted for the issuance of bitcoin (BTC) bonds. Like the monetary legalization of the leading cryptocurrency in the country, this is a first.

As per usual, it was Nayib Bukele, the outgoing President of El Salvador, who published the news. On X (formerly Twitter), the political leader shared information about the upcoming launch of these bonds, scheduled for the first quarter of 2024.

The issuance of these financial instruments called “Volcano Bonds” will be facilitated by Bitfinex Securities, a regulated division of the famous crypto exchange Bitfinex. A development that excited Nayib Bukele.

He indicated that regulatory green light had been obtained. Largely thanks to the approval of the Digital Asset Committee (CNAD), as was also revealed by the National Bitcoin Office of El Salvador.

🚨BREAKING: World’s first #Bitcoin bonds receive regulatory approval in El Salvador 🇸🇻❗️ pic.twitter.com/XBdBk0tDS2

— Titan of Crypto (@Washigorira) December 12, 2023

A Look Back at the History of the “Volcano Bonds”

It should be noted that the Volcano Bonds are not exactly a new project. Their genesis dates back to 2021. Following the monetary legalization of the flagship cryptocurrency in El Salvador, plans to issue financial instruments using the asset had been leaked.

The goal was nothing less than ambitious as it aimed to raise 1 billion dollars through these bonds. With a particularity, nonetheless. To provide funds that support the Salvadoran bitcoin mining ecosystem, especially powered by renewable energy.

Originally scheduled for a March 2022 issuance, the project was delayed. However, the introduction of a digital asset bill to the Salvadoran Legislative Assembly in November 2022 put the initiative back on the table.

Subsequently, the bill received massive support leading to its enactment after adoption in January 2023. A breakthrough that paved the way for the realization of El Salvador’s innovative financial vision.