El Salvador is considering creating an entire city based on Bitcoin

El Salvador is considering creating an entire city based on Bitcoin

Bitcoin mining would be viable, even if we were to completely rely on the power plant.

El Salvador is continuing to increase its support for Bitcoin. The president has implemented plans to build a new city, focused on the innovation of cryptocurrency. Coindesk and BBC News have reported this news. Announced today, the metropolis will have its geothermal power plant to support crypto mining. No capital gains, income, payroll, or property taxes will apply as a result.

La Unión is a developing city and like most small cities, travels for work can be difficult. While the new development is expected to include all of the typical amenities that people would expect from a typical city, many living in La Unión may still have to travel for work.

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Bukele didn’t provide the timeline for the city’s creation. However, he unveiled a US $1 billion “Bitcoin bond” where half is used to build energy and mining infrastructure, with the rest used to buy more digital currency. Samson Mow, the strategy chief for Blockstream, said that El Salvador would start selling crypto holdings after five years and distribute an extra dividend to bondholders. With an initial 6.5% yield, this could be a huge boon for investors who typically get lower yields on government bonds.

It has been a huge gamble for the company as they have only $24.6 billion in profits and hope that Bitcoin can help them grow into a prosperous country. Mayor Bukele is counting on it to “spur economic growth, independence, and investment.”Many people are still uncertain of the viability of this new crypto-community. With tax incentives, would-be residents and investors might choose a community with a higher concentration of bitcoin transactions. However, there’s not enough support for the project to succeed.

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