El Salvador releases plans to build a bitcoin city within the country

On November 21, 2021, President Nayib Bukele of El Salvador announced the creation of the world’s first “Bitcoin City” at the base of the Conchagua volcano. This ambitious project was envisioned as a fully functional city with residential and commercial areas, services, museums, entertainment venues, an airport, and even a port, all operating with Bitcoin as the central economic structure.
 

The city was designed to be circular, symbolizing the shape of a coin, and was to be powered by the geothermal energy of the Conchagua volcano, which would also support Bitcoin mining operations. Bukele’s vision extended beyond just an economic experiment; it was to be a hub for technological innovation and a testament to the potential of Bitcoin in shaping future societies.
 

In Bitcoin City, no income taxes would be levied. Instead, the city would rely on value-added tax (VAT) for revenue, with half of the proceeds intended for infrastructure development and the other half for maintenance and cleanliness of the city. This tax model was part of a broader strategy to attract investment and foster a business-friendly environment.
 

To finance the construction of Bitcoin City, President Bukele proposed the issuance of $1 billion in Bitcoin bonds.