El Salvador’s ‘Volcano Bonds’ Advance Immensely as Bitcoin Eyes $45K Mark

El Salvador‘s ambition to pioneer Bitcoin-backed bonds, famously termed ‘Volcano Bonds,’ has taken a substantial step forward with reported regulatory approval slated for an early 2024 issuance, according to announcements from the nation’s Bitcoin-centric entity.

The upcoming bonds are poised to be introduced through Bitfinex Securities, an authorized wing of the renowned cryptocurrency exchange Bitfinex.

Announcing a significant milestone, El Salvador’s National Bitcoin Office revealed through its X address that the “Volcano Bond” had secured regulatory consent from the Digital Assets Commission (CNAD). The office further expressed anticipation for the bond’s issuance within the first quarter of 2024.

President Nayib Bukele echoed these sentiments on X, sharing inquiries about the timing of the “Volcano bond” and reiterating multiple indications pinpointing the expected issuance in Q1 2024.

The genesis of the so-called ‘Volcano Bonds’ traces back to 2021 when President Nayib Bukele unveiled plans shortly after passing legislation acknowledging Bitcoin (BTC) as legal tender within the country.

Bukele’s vision encompasses raising $1 billion via these Bitcoin-backed bonds, aiming to catalyze a Bitcoin mining sector reliant exclusively on renewable energy, including that generated by the nation’s active volcanoes.

Although initial plans slated issuance for March 2022, subsequent delays ensued. Nevertheless, the digital assets bill made its debut in the Legislative Assembly towards the end of November 2022, where Bukele’s party, Nuevas Ideas, commands a significant majority.

The recent session witnessed 62 legislators voting in favor of the regulation, with 16 expressing dissent. Ultimately, the bill was ratified in January 2021.

This pivotal development marks the second major Bitcoin-centric initiative within a fortnight. Previously, El Salvador launched its “Freedom VISA” program, offering residency to a maximum of 1,000 individuals annually who invest at least $1 million worth of Bitcoin or tether (USDT) stablecoins.

The journey toward implementing these groundbreaking financial instruments seems to be gaining traction, signifying El Salvador’s persistent commitment to fostering innovation within the cryptocurrency domain.