Bills to create legal support for the issue of Volcano Bonds denominated in bitcoins have been sent to the El Salvadorian Congress.
El Salvador’s Finance Minister Alejandro Zelaya said that bills would soon be brought before Congress to ensure the legitimacy of the Volcano Bonds, Reuters reported.
The government continues to work to create a legal framework governing the issuance of Bitcoin-denominated securities. The twenty bills to be approved in Congress are aimed at “providing a legal structure and legal certainty for everyone who buys a bond with Bitcoin.”
The $ 1 billion that El Salvador seeks to raise through the bond issue will be spent on infrastructure for Bitcoin City, where it plans to provide “digital and technological education, geothermal energy for the entire city. The El Salvadorian government is positioning Bitcoin City as a “tax haven” where there will be no taxes on income, capital gains, property, wages, and municipal taxes.
The only tax that will be withheld from Bitcoin City residents is value added tax. Part of the funds raised will be used to cover the costs of maintaining the issue of Volcano Bonds, and the rest – to develop the city’s public infrastructure.
The money raised during the Volcano Bonds issue can be used by El Salvador to repay the $ 800 million Eurobond issue, which matures in January 2023.
