El Salvador and Bitfinex: Collaboration to Launch Bitcoin-Backed Bonds

• El Salvador announces the issuance of Bitcoin-backed “Volcano Bonds” planned for the first quarter of 2024.
• Stacy Herbert and Max Keiser of the Bitcoin Office work with Bitfinex to finalize details of the bonds.

El Salvador is positioned as a pioneer in the integration of cryptocurrencies in its financial system. Recently, Stacy Herbert and Max Keiser, residents of this Central American country and current leaders of the Bitcoin Office, confirmed the issuance of the expected Bitcoin bonds for the first quarter of 2024.

This announcement, made during a live broadcast on X, was attended by key industry figures such as Juan Carlos Reyes, president of the National Commission of Digital Assets; Paolo Ardoino, CTO of Bitfinex; and Jesse Knutson, Chief Operating Officer of Bitfinex Securities. The delay in the issuance of these bonds, initially announced two years ago and postponed on several occasions, has generated intense debate.

Herbert, responding to frequent doubts raised in social networks, assured that the delay is due to the need to establish the terms and conditions meticulously and await more propitious economic conditions. ” We want it to benefit both El Salvador and investors,” he emphasized.

The Bitcoin Office, in collaboration with Bitfinex Securities, is focused on defining the right terms and achieving consensus on conditions, thus ensuring a successful launch. In addition, the political context in El Salvador, with presidential elections scheduled for February 4, plays a crucial role in the timing of the bond issuance. The re-election of Nayib Bukele as president could give a definite boost to this project.

The “Volcano Bonds” stand out in the global financial landscape, with a $1 billion Bitcoin-backed issuance. This initiative, announced by Bukele shortly after the historic law recognizing Bitcoin as legal tender in El Salvador, promises to revolutionize not only the national economy but also the global perception of cryptocurrencies.

These bonds, which are expected to offer an annual interest coupon of 6.50% in dollars, will be paid to investors every January for ten years. The Digital Assets Commission, which approved the issuance of the bonds last December, anticipates a large inflow of capital, with thousands of investors setting their sights on El Salvador.

The Bitcoin bond offering will be conducted through Bitfinex Securities, a regulated division of the well-known cryptocurrency exchange platform. Ardoino and Knutson highlight the unique nature of these bonds.

“They will be the first of their kind and we aspire to position El Salvador as a leader in the international market,” said Ardoino.

With Bitcoin as legal tender and specific legislation for cryptocurrencies, El Salvador already has a comparative advantage over the rest of the world.