> However, he simultaneously unveiled a $1 billion US "Bitcoin bond" where half would be used to build energy and mining infrastructure, with the rest used to buy more of the digital currency
This Bitcoin bond is supposedly going to pay 6.5% interest. If Bitcoin crashes, the bond will fail and the investors lose. If Bitcoin skyrockets, El Salvador keeps the profits and the investors only get their 6.5%.
They’re also being up front about the idea that the bond itself will boost Bitcoin prices because they’ll be buying Bitcoin but not selling (aka HODLing), which drives up the price. It’s like they’re saying the quiet part out loud and forgot to pretend that it’s supposed to be a currency.
Why would any rational investor invest in this bond instead of investing directly in Bitcoin?
It feels like someone in the El Salvador government has a lot of Bitcoin investments and they’re abusing the hell out of their government situation to pump their investments to the moon. Even the hardcore pro-Bitcoin people I know aren’t thrilled about this.
This Bitcoin bond is supposedly going to pay 6.5% interest. If Bitcoin crashes, the bond will fail and the investors lose. If Bitcoin skyrockets, El Salvador keeps the profits and the investors only get their 6.5%.
They’re also being up front about the idea that the bond itself will boost Bitcoin prices because they’ll be buying Bitcoin but not selling (aka HODLing), which drives up the price. It’s like they’re saying the quiet part out loud and forgot to pretend that it’s supposed to be a currency.
Why would any rational investor invest in this bond instead of investing directly in Bitcoin?
It feels like someone in the El Salvador government has a lot of Bitcoin investments and they’re abusing the hell out of their government situation to pump their investments to the moon. Even the hardcore pro-Bitcoin people I know aren’t thrilled about this.