The Bitcoin bond was first anticipated to go on sale in the first quarter of 2022 when it was first announced in November of last year.
El Salvador, a country in Central America that recognized Bitcoin (BTC) as legal tender in September of last year, has once more postponed the issuance of its $1 billion Bitcoin bond.
The first announcement of the Bitcoin bond, also referred to as the Volcanic bond or Volcanic token, was made in November 2021 as a way to issue tokenized bonds and raise $1 billion in return from investors. The money raised will then go toward creating a Bitcoin City and purchasing additional BTC.
The bond was originally scheduled to be released in the first quarter of 2022, but due to unfavorable market conditions and global crises, the date was moved to September. The Bitcoin bond will now launch at the end of the year, according to chief technology officer of Bitfinex and Tether Paolo Ardoino, who made the announcement earlier this week.
revealed that the current launch delay may be a result of internal security concerns caused by the need for the national security forces to deal with the scourge of gang violence in the nation. Because of this, government resources have been redirected, and “the delay in the launch of the Volcano Token has to be viewed in this context,” according to the report.
The El Salvadorian government’s primary infrastructure partner, Bitfinex, is in charge of handling transactions resulting from the sale of Volcanic tokens. But before the government will grant Bitfinex a license to issue securities, the digital securities bill, which is scheduled to be passed in September, must first be approved.
The final draft of the bill is ready, according to Ardoino, and given that President Nayib Bukele’s party has a majority, they anticipate it to be passed in the coming weeks. He stated:
“We are confident that the law will obtain approval from Congress in the coming weeks, assuming that the country has the necessary stability for such legislation to pass.”
Upon passage of this legislation into law, Bitfinex Securities El Salvador, S.A. de C.V. “will apply for a license to operate under the El Salvador digital securities regulatory framework,” he continued.
While a number of reports and industry analysts have laid the blame for the current slump in the cryptocurrency market and waning investor interest on these factors, Ardoino is confident that investors would be interested in the Bitcoin bond concept regardless of the state of the market.
The Bitcoin bond, he continued, may hasten the adoption of BTC. He clarified using meme coins as an illustration:
“When you consider that the memecoin, Dogecoin, was able to obtain a market capitalization of $48 billion, there is clearly enough investor appetite in the digital token economy to support a $1 billion Volcano.”
On September 7, 2021, El Salvador declared BTC to be legal tender and subsequently accumulated over 2,301 BTC worth roughly $103.9 million. The investment’s profits were even used to finance the construction of hospitals and schools during the bull market, but now that the market is in a bear market, the value of the BTC holdings is only about $45 million.