El Salvador's top leader Nayib Bukele has announced plans to create a Bitcoin city at the base of the Conchagua volcano in the south-eastern region of La Unión, with its geothermal energy powering Bitcoin mining.

Currently, the government is running a pilot Bitcoin mining venture at the foot of the Tecapa volcano, another geothermal power plant location, according to Time.

Bukele said the new city is designed to be circular to represent the shape of a large coin as the project was funded by the said controversial cryptocurrency.

The impoverished Latin American country, which recently became the first country to use Bitcoin as legal tender in September, fanned the flames of large-scale protests over fears the virtual currency would bring instability and inflation to El Salvador.

Citizens cast doubt on the project as Bitcoin's value can fluctuate significantly.

On Saturday, Bukele boasted that the plan for the new Bitcoin city would "include everything."

"Residential areas, commercial areas, services, museums, entertainment, bars, restaurants, airport, port, rail - everything devoted to Bitcoin," he told the angry crowd in the coastal town of Mizata while promoting a Bitcoin event in the area.

The president added that value-added tax would be levied in the city, with half of the revenue gained from it to fund its construction. The rest of the pie would go in keeping the streets clean, he added.

Mining cryptocurrencies are costly, done with sophisticated computers to solve complex mathematical problems that also take up large amounts of energy.

Likening his plan to cities Alexander the Great founded, Bukele said the new city will feature a central plaza that would appear like a Bitcoin symbol from the air, according to the BBC.

While the dates for the sod-cutting and completion of the public infrastructure remain unknown, a bond offering entirely in Bitcoin is expected to be done in 2022. Two months after financing was ready, construction would begin.

It is also estimated that much of the cryptocurrency-fueled project would cost the government around 300,000 BTC or $17.4 billion, with one bitcoin currently trading at just around $58,000 (£45,000), Al Jazeera noted.

President Nayib Bukele
President Nayib Bukele would use his Twitter account to explain to his 2.8 million followers and other users the national digital wallet Chivo, a Salvadoran slang for “cool,” had been unplugged by the government to connect to more servers and increase capacity after it was inundated with user registrations Yuri Cortez/Getty Images

© 2024 Latin Times. All rights reserved. Do not reproduce without permission.