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The Bitcoin City: El Salvador Receives $1.6 Billion Investment to Upgrade Seaports

TLDR

  • El Salvador has secured a $1.6 billion investment from Turkish company Yilport Holdings to upgrade two seaports.
  • One of the ports, La Union, is located near the site of the proposed Bitcoin City.
  • This investment is the largest private investment in El Salvador’s history.
  • The deal involves a 50-year joint venture between Yilport and El Salvador’s port authority.
  • The investment is expected to support the development of Bitcoin City, although construction has not yet begun.

El Salvador’s ambitious “Bitcoin City” project has received a significant boost with the announcement of a $1.6 billion investment from Turkish company Yilport Holdings.

This investment, the largest private investment in the country’s history, will be used to upgrade two of El Salvador’s seaports, including one near the proposed site of Bitcoin City.

President Nayib Bukele shared a video statement on Monday detailing the investment, which marks the third phase of his government’s economic development program focusing on logistics.

The deal involves a joint venture between Yilport Holdings and El Salvador’s Comisión Ejecutiva Portuaria Autónoma (CEPA) to manage the Acajutla and La Unión ports for the next 50 years.

The Acajutla Seaport, which handles most of the nation’s exports of coffee, sugar, and balsamic salts, will see significant upgrades. The project will unfold in phases, starting at the end of this year. The first phase will modernize Acajutla’s infrastructure and acquire new equipment, while the second phase will involve constructing additional infrastructure to triple the port’s capacity.

Bitcoin City

Of particular interest is the investment in the La Unión Seaport, which has been inactive for nearly two decades.

This port is located near the proposed site of Bitcoin City, a visionary project first pitched by President Bukele in November 2021. The initial phase at La Unión will focus on dredging and procuring new equipment, potentially laying the groundwork for the future development of Bitcoin City.

Bitcoin City is envisioned as a tax-free city that would fund itself through Bitcoin mining powered by regional volcanoes. The city plans include residential areas, commercial hubs, museums, entertainment venues, an airport, a port, and rail connections. While construction has yet to commence, this significant investment in nearby infrastructure is seen as a positive step towards realizing this ambitious project.

Stacy Herbert, head of El Salvador’s National Bitcoin Office, emphasized the potential economic impact of the investment, stating it will create “thousands of direct and indirect jobs” and lead to “more investment in underlying local infrastructure.” Max Keiser, another member of the Bitcoin office, characterized the deal as a Bitcoin City infrastructure investment, suggesting it could pave the way for further developments.

The investment comes at a time when El Salvador continues to demonstrate its commitment to Bitcoin. According to the Bitcoin Office website, the country currently holds 5,840.76 BTC, worth approximately $345 million. El Salvador has been consistently adding to its Bitcoin holdings, purchasing 1 BTC daily.

While the Bitcoin City project was initially intended to be funded through “Bitcoin bonds,” these fundraising efforts have faced delays. However, El Salvador has found alternative sources of capital, including a renewable Bitcoin mining partnership with Tether and a “Freedom Visa” program offered to wealthy Bitcoin investors.

This latest investment represents a step forward in El Salvador’s economic development and its ambitions to become a global hub for cryptocurrency.

By upgrading its port infrastructure, the country is not only improving its logistics capabilities but also potentially laying the groundwork for the realization of Bitcoin City.

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