In a rock concert-like atmosphere, El Salvador’s President Nayib Bukele announced that his government will build an oceanside “Bitcoin City” at the base of a volcano.
Bukele used a gathering of Bitcoin enthusiasts as the audience for launching his latest idea. He announced at an earlier Bitcoin conference in Miami that El Salvador would be the first country to make the cryptocurrency legal tender. That went into effect in September.
Wearing his signature backwards-turned baseball cap, Bukele held a microphone in front of a massive LED video screen. He said that Bitcoin financing would begin in 2022, with groundbreaking on the new city to follow shortly thereafter.
Plans say the city will be built near the Conchagua volcano. Solving the complex mathematical calculations that release Bitcoin transactions is energy-intensive. The process, called mining, will run day and night in the new cyber-focused city. Proximity to the volcano will allow the community to take advantage of geothermal energy for powering both the city and the Bitcoin mining processes.
The Salvadoran government is already running a pilot Bitcoin mining venture at another geothermal power plant beside the Tecapa volcano.
The government seeks to attract investors in the new city by providing land, infrastructure, and work opportunities. The only tax collected there will be a value-added tax, half of which help pay for municipal infrastructure and maintenance. Bukele says there will be no property, income, or municipal taxes. He also envisions a city with zero carbon dioxide emissions. There will be residential areas, malls, restaurants, and a port, Bukele says. The president talks of digital education, technology, and sustainable public transportation.
“Invest here and earn all the money you want,” Bukele told the cheering crowd in English at the closing of the Latin American Bitcoin and Blockchain Conference.
It may sound too good to be true. The optimistic president is presenting the futuristic city as a type of “utopia.” That’s a term often used in literature for an imagined place where everything operates perfectly—a world without sin.
The Bible refers to such a place too, but recognizes that it won’t occur on Earth, among sinful people, before Christ returns to make all things new. Until then, “in the world, you will have tribulation,” says Jesus in John 16:33. And, “the poor you always have with you.” (John 12:8) But a time is coming when that will change. “He who has no money, come, buy and eat! Come, buy wine and milk without money and without price,” promises Isaiah 55:1, looking ahead to that glorious future home.
In the meantime, exploring economic options like cryptocurrency isn’t wrong. Economies have changed much over the millennia—from systems of bartering goods and services, to trading shells, beads, or jewels for goods, to centralized national currencies. Change is likely to continue and can be done well, though greed is always going to influence the way humans handle wealth.
Critics warn that cryptocurrency’s lack of transparency could attract increased criminal activity to El Salvador. They also express concern that digital currency’s wild swings in value pose a risk to those holding it. The cautions are well advised. In his zeal to entice foreign investment into El Salvador, Bukele might do well to add to his fervor prudence, wisdom, and patience.
(A Bitcoin symbol glows on an LED screen at a cryptocurrency ceremony behind El Salvador’s President Nayib Bukele on November 20, 2021. The president announced his government will build an oceanside Bitcoin city at the base of a volcano. AP/Salvador Melendez)