El Salvador Bets Big on Bitcoin Bond Launch This Week

Key Insights:

• Bitcoin bond launch may be delayed due to war in Ukraine.
• Retail investors are more likely to be interested in it.
• BTC prices have fallen 28% since El Salvador legalized it.

The timeline for the launch is between March 15 and 20. However, geopolitical events such as the war in Ukraine may affect the schedule.

El Salvador finance minister, Alejandro Zelaya, confirmed that there might be delays due to the ongoing conflict.

“We believe that between Mar. 15 and 20 is the right timing. We have the tools almost finished. But the international context will tell us… I didn’t expect the war in Ukraine,”

The ten-year volcano Bitcoin Bond is a vital part of El Salvador’s economic revival experiment in which it hopes to raise $1 billion. The income from the bonds is to be split into buying more of the asset and funding a ‘Bitcoin City’ near the Conchagua volcano in the  La Unión region in the country’s southeast.

Big BTC Bet

Former president of El Salvador’s central bank, Carlos Acevedo, said that a lot of doors would close if this is a failure, adding that the bond’s issuance is going to define a lot.

Institutional investors are keeping an eye on the bond but remaining on the sidelines for now, with most investors expected to be retail, according to the Financial Times.

One such investor, Josué País, the owner of an El Salvador taxi business that accepts payments in BTC, said that he plans to put about $200 into the bond when it launches this week, adding:

“Number one, I’m going to do it to support the country. Number two, because it’s a big, attractive bet.”

Since the country made Bitcoin legal around six months ago in early September, the asset has declined 28% from a price of just over $52,000 on the 7th of that month to around $38,000 today.

El Salvador’s millennial President, Nayib Bukele, has ‘bought the dip’ several times on the way down, increasing the country’s digital asset stash.

Bitcoin Price Outlook

At the time of writing, Bitcoin (BTC) was trading at $38,065 after falling 3% over the past 24 hours. Monday morning’s Asia trading session has been bearish yet again for crypto markets with a 2.4% loss in total capitalization, which has fallen to $1.77 trillion.

Bitcoin has now depreciated by 10% over the past month and is currently down almost 45% from its November 10 all-time high of $69,000.