© Reuters
Investing.com – El Salvador’s Legislative Assembly on Wednesday approved a law to issue digital assets other than . The legislation includes a legal framework for issuing a Bitcoin-backed bond, also known as a Volcano bond.
In November 2021, the President of El Salvador, Nayib Bukele, announced that the Central American country – which earlier in the year established bitcoin (BTC) as legal tender – planned to raise $1 billion via bonds backed by bitcoins. The proposed asset soon became known as volcano bonds, as the money was to be used – among other things – to launch a bitcoin mining industry based solely on renewable energy, including that generated by active volcanoes. from the country.
Although originally scheduled for March 2022, the bond issuance had to be postponed several times, mainly due to last year’s brutal bitcoin bear market. The Digital Assets Bill was finally presented to the Legislative Assembly at the end of November 2022, where Bukele’s party, Nuevas Ideas, has a large majority.
In a statement on Wednesday, Bitfinex said it “will be an infrastructure provider for what it believes should really be called the ‘Volcano Token’ – “a digital token that would help El Salvador raise capital to repay its sovereign debt, to direct funds towards the creation of a Bitcoin mining infrastructure and to finance the construction of “Bitcoin City”.