The action has been met with substantial suspicion from a variety of different sources over the choice made by President Nayib Bukele.
As a result of the nation of Central America's determination to make use of digital assets for the transaction, it has launched a few projects geared toward attaining its goals and objectives.
The country is planning to issue Bitcoin Bonds as one of the cryptocurrency-related initiatives it is pursuing. Despite this, the launch was delayed more than once by the country because of various problems. Moreover, it would appear that there could be additional delays as a result of the country's pursuit of its concerns.
During this time, El Salvador postponed the launch that was scheduled for March 2022 due to the ongoing correction in the cryptocurrency market. Despite the several delays, the government of this country has not established a definitive timeframe for the introduction of its Bitcoin bond.
Several analysts in the sector are of the opinion that there is insufficient investor interest, while others are of the opinion that it is possible that the government will never implement the Bitcoin bond.
Possible Completion of the Bitcoin Bond Draft
Bitifinex, the only exchange operator in El Salvador, has issued a statement saying that the company is waiting for the passage of the digital asset statute before proceeding with its Bitcoin bond project. The passage of this bill will make it possible for the corporation to eventually become the Bitcoin bond's officially recognized service provider.
On the other hand, the company disclosed in a recent statement that officials from the government have informed the exchange that the final draft of the bond is ready. In addition, it is expected that the bill would be passed into law in the country over the next two weeks. However, the administration has not provided a particular timetable for when the relocation will take place.
Paolo Ardoino, the Chief Technology Officer (CTO) of Bifinex, stated that it will take two to three months to iron out all of the details even if the bill is passed in September. In the meantime, if El Salvador is unable to pass the draft bill in September, this will result in yet another postponement that will carry over into the following year.
William Snead, who is a Latin American digital asset strategist, has revealed the fact that El Salvador already has a poor credit rating. The issuing of a cryptocurrency bond is unlikely to enter the market and will have a low chance of succeeding if it does.
El Salvador’s Crypto Bond Move
The leadership of the country, despite the fact that the economy is struggling to maintain its footing, views cryptocurrency as the answer to the country's financial and monetary woes. Since the previous year, the government of El Salvador has been investigating the possibility of issuing bonds denominated in bitcoin. However, the proposal has been put on hold more than once.
On the other hand, the country is planning to put a significant portion of its reserves into cryptocurrencies beginning in the year 2022. Despite the fact that the nation has already sustained a significant loss from its initial investments, they are moving forward with plans to issue a Bitcoin bond. Following the adoption of the cryptocurrency as a form of legal tender, the country's crypto-bull leader, Nayib Bukele, is the genius behind the attempt to center the economy around Bitcoin. The availability of financial services has also improved, which is a welcome development.
In addition to an increase in tourism, the country's Minister of Finance, Alejandro Zelaya, disclosed an increase in access to financial services. In spite of the fact that it has been losing money in the past, the government is optimistic about the possibility of investing in digital assets.