Here’s Why El Salvador’s Bitcoin Bond Move Is Stalled
El Salvador has been developing its Bitcoin bonds since last year, when its president approved Bitcoin as a legal tender. The move has been met with widespread skepticism from various quarters over the decision of President Nayib Bukele.
Due to its drive to implement digital assets for the transaction, the Central American nation has rolled out some projects toward achieving its aims.
One of the crypto initiatives is the Bitcoin Bond that the country is looking to launch. However, the country halted the launch multiple times due to some issues. And it appears there could be further delays as the country seeks out its challenges.
Meanwhile, El Salvador suspended the launch in March 2022 amid the crypto market correction. Despite the various postponements, the country has set no clear timeline regarding the launch of its Bitcoin bond.
Several industry analysts say there isn’t sufficient investor interest; others are skeptical that the country may never realize the Bitcoin bond.
Bitcoin Bond Draft May Be Ready
According to a statement from Bitifinex, El Salvador’s sole exchange provider for its Bitcoin bond project, it awaits the passage of the digital asset bill. The bill will pave the way for the company to emerge as the officially recognized service provider for the Bitcoin bond.
However, in a recent statement, the firm revealed that government officials have relayed to the exchange that the final bond draft is ready. In addition, the country plans to pass the bill a couple of weeks from now. Still, no specific timeline for the move was given by the government.
Paolo Ardoino, the Chief Technology Officer (CTO) of Bifinex, noted that if the bill is passed in September, it will take two to three months to iron out everything.
Meanwhile, if El Salvador failed to pass the draft bill in September, it would mean another delay running into the coming year.
A Latin American digital asset strategist, William Snead, disclosed that El Salvador already has a bad credit rating. The issuance of a crypto bond will have a low success rate and is unlikely to enter the market.
El Salvador’s Crypto Bond Move
Despite being mired in a not very buoyant economy, the country’s leadership sees cryptocurrency as the solution to its fiscal and monetary woes. El Salvador has been considering offering Bitcoin bonds since last year, but the plan has been suspended severally.
However, the start of 2022 will see the country invest a huge amount of its reserves into cryptocurrency. The country has already suffered a massive loss in its initial investments but is forging ahead to launch a Bitcoin bond.
Its crypto-bull leader, Nayib Bukele, is the mastermind behind the country’s Bitcoin-centric move after adopting the token as a legal tender. On the positive side, it has increased access to financial services.
Its finance minister, Alejandro Zelaya, revealed a rise in access to financial services alongside a tourism boost. And the government is bullish on the prospect of its investment in digital assets despite its previous losses.
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