A few weeks ago El Salvador announced the imminent issuance of a $1 billion Bitcoin Bond.
The bond has not yet been launched on the market, but it turns out that it has already been 30% “reserved”.
El Salvador's bond already 30% filled with verbal commitments before it has even launched!
Ways to make the bond more attractive:
— Alistair Milne (@alistairmilne) December 7, 2021
The Bitcoin Bond of El Salvador
The announcement was made by the CSO of Blockstream, a company involved in El Salvador’s project related to the issuance of this bond.
The bond is called EBB1 (El Salvador Bitcoin Bond 1), and of the $1 billion budgeted, $300 million has already been booked.
In reality, these are only “verbal commitments”, but it seems that there are additional benefits for subscribers in order to encourage even more purchases.
According to Blockstream itself on its official blog, the bond has been months in the making and has the potential to accelerate hyperbitcoinization through a new financial system based on Bitcoin.
The bond will be issued in the form of tokens on Liquid Network, and the $1 billion raised will be used half to buy BTC, and the other half to fund the cost of building Bitcoin energy and mining infrastructure in the region.
Bitfinex will issue the Bitcoin Bond
The issuer is expected to be Bitfinex Securities, to which El Salvador will grant a licence to be able to process the bond issue.
The Bitcoin Bond will distribute special dividends generated by the staggered liquidation of BTC bought with half of the funds raised by the issuance on the market. Blockstream’s Asset Management Platform (AMP) will be used for the distribution, whereby the dividends will be paid instantly to the bondholders.
This project, according to its creators, represents the beginning of a real reform of the capital markets, built on Bitcoin and Level 2 technologies such as Liquid Network.
In fact, thanks to these new technologies, capital can flow easily from all over the world without friction, dividends can be distributed instantaneously and respecting the privacy of investors, and bonds can be traded 24/7, even with stablecoin and without intermediaries.
For now, there is no further information to verify how it really works, or how one can invest in this bond.