El Salvador is getting closer to realizing its ambitious aim to issue volcano Bitcoin bonds, thanks to regulatory permission for the investment initiative. The Volcano Bond has gained approval from the Digital Assets Commission (CNAD), according to a recent announcement from El Salvador’s National Bitcoin Office (ONBTC). The country has gotten the green light for its Bitcoin bonds, representing a significant step forward for the project.

In light of El Salvador’s pro-crypto position, the expected issue of these bonds is scheduled for the first quarter of 2024, which will mark the beginning of new capital market initiatives associated with Bitcoin in the nation. Following approval by El Salvador and Kazakhstan’s regulatory body, the bonds will now be able to be listed on the Bitfinex Securities platform.

President Nayib Bukele excitedly verified the regulatory permission in a lighthearted tweet early Tuesday morning. “Wen volcano bond?” he quipped. The launch of Bitcoin volcano bonds in 2021—shortly after the cryptocurrency was made legal tender in El Salvador—follows this development.

Launching the Volcano Bitcoin Bonds

El Salvador Has Gotten the Green Light for Its Volcano Bitcoin Bonds

Using renewable energy from active volcanoes, El Salvador’s Bitcoin mining industry supports the project, initially intended to raise $1 billion through these bonds secured by Bitcoin. Pre-launch plans for the bonds had called for March 2022, but the unfavorable market conditions caused delays.

However, adopting crypto law in November 2022 altered the legal environment and made the required approvals easier.

The volcano Bitcoin bonds, currently slated for issue in early 2024, are intended to have a ten-year maturity and provide investors with an alluring 6.5% annual return. This financial instrument uniquely converges capital markets, sustainable energy, and cryptocurrencies in El Salvador’s changing economic landscape.

The country launched a new Freedom Visa and Citizenship program on December 8, intending to encourage innovative contributions to improving society, culture, and economy. It should be noted that this Tether-supported project is only intended for wealthy people, or “whales,” who must invest a minimum of $1 million in Bitcoin or USDT to be eligible for the desired visa, which grants citizenship.

Since September 2021, President Nayib Bukele has been actively accumulating Bitcoin, creating a noteworthy stockpile of 2,770, estimated to be worth $115 million. Despite the strategic acquisitions, many of these purchases were made during the bull market, so the portfolio has lost money over the last two years.

Bitcoin Investments Break Even

El Salvador Has Gotten the Green Light for Its Volcano Bitcoin Bonds

The pivotal moment occurred last week when the price of Bitcoin shot up to $44,000, enabling the nation’s cryptocurrency holdings to break even at last. However, the recent market turbulence brought on by leverage-related liquidations has driven down BTC prices, resulting in a 2.1% decline in the portfolio. President Bukele’s Bitcoin holdings currently have a dollar-cost average of $42,436, according to NayibTracker.

Comparing El Salvador’s cutting-edge citizenship initiative with the swings in its bitcoin holdings highlights how dynamic the nation’s entry into the crypto sector has been. The viability and durability of such projects remain inextricably linked to the unpredictable cryptocurrency market, which adds another degree of complication to the country’s shifting economic strategy.