El Salvador’s ambitious vision for Bitcoin City is gaining renewed momentum, fueled by a landmark $1.6 billion investment in port infrastructure. This transformative project centers on the strategic development of two key ports—Acajutla and La Unión—and could finally bring the long-promised cryptocurrency-powered city to life. With the nation doubling down on its Bitcoin-driven economic model, the revitalization of La Unión Port emerges as the cornerstone of this futuristic urban experiment.
A Historic Investment in El Salvador’s Future
The $1.6 billion investment from Yilport Holdings, a leading Turkish port operator, marks the largest private infrastructure commitment in El Salvador’s history. Under a 50-year public-private partnership, Yilport will co-manage the ports of Acajutla and La Unión alongside El Salvador’s Autonomous Port Executive Commission (CEPA). This collaboration aims to modernize port operations, boost trade capacity, and lay the logistical foundation for broader economic development.
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Announced via a video shared by President Nayib Bukele on his X account, the deal underscores the government’s confidence in leveraging strategic assets to attract global capital. The focus on port modernization isn’t just about trade—it’s a calculated move to anchor the development of Bitcoin City, envisioned as a tax-incentivized, Bitcoin-based urban hub.
Bitcoin City and the Strategic Role of La Unión
Bitcoin City is planned for construction near the La Unión Port, a location chosen for its geographic and economic potential. Although initial construction on the port began in 2005, progress stalled, leaving it underdeveloped for nearly two decades. Now, with Yilport’s involvement, dredging and procurement of heavy machinery are expected to begin by the end of 2025, setting the stage for full-scale redevelopment.
The synergy between the port and Bitcoin City is more than logistical—it’s symbolic. The city is designed to operate almost entirely on Bitcoin, with no income, property, or municipal taxes except for a value-added tax (VAT). Its energy needs are intended to be met through geothermal power harnessed from nearby extinct volcanoes, reinforcing sustainability and self-sufficiency.
This integration of clean energy, digital currency, and urban planning positions Bitcoin City as a pioneering model for decentralized economic zones in emerging markets.
The Volcano Bond: Financing the Bitcoin Dream
Central to funding Bitcoin City was the proposed $1 billion Volcano Bond, so named because it would be backed by geothermal energy used to mine Bitcoin. First announced in 2021 alongside El Salvador’s adoption of Bitcoin as legal tender, the bond faced delays but cleared critical legislative and regulatory hurdles by December 2024.
Though its initial launch in early 2025 was postponed, the bond remains a key component of the long-term financing strategy. If successfully issued, proceeds would support both infrastructure development and Bitcoin mining operations powered by renewable energy.
Technical support for the project was originally expected from Blockstream and iFinex (the company behind Tether). However, after Samson Mow left Blockstream, he founded JAN3, a new entity committed to advancing Bitcoin adoption in El Salvador and contributing to Bitcoin City’s development.
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Economic Vision and National Ambition
El Salvador’s push for Bitcoin City reflects a broader national strategy to attract foreign investment, reduce reliance on traditional financial systems, and position itself as a leader in blockchain innovation. By combining physical infrastructure with digital currency ecosystems, the government aims to create a self-sustaining economic zone that could serve as a blueprint for other nations.
The National Bitcoin Commission Office has expressed strong enthusiasm about linking port revitalization with urban development. Officials believe that improved logistics will not only facilitate construction but also attract tech startups, remote workers, and crypto entrepreneurs seeking a forward-thinking environment.
Frequently Asked Questions (FAQ)
Q: What is Bitcoin City in El Salvador?
A: Bitcoin City is a planned urban development near La Unión designed to operate primarily on Bitcoin. It will offer tax incentives and use geothermal energy for power and Bitcoin mining.
Q: How is Bitcoin City being funded?
A: The primary proposed funding mechanism is the $1 billion Volcano Bond, which would be backed by geothermal energy used to mine Bitcoin. Additional funding comes from private investments like the $1.6 billion port deal.
Q: Why is the La Unión Port important to Bitcoin City?
A: The port serves as a critical logistics hub for construction materials and trade. Its redevelopment supports the infrastructure needs of Bitcoin City and enhances regional economic connectivity.
Q: Who is investing in El Salvador’s ports?
A: Yilport Holdings, a Turkish port operator, is investing $1.6 billion in partnership with CEPA to modernize the Acajutla and La Unión ports under a 50-year agreement.
Q: Is Bitcoin legal tender in El Salvador?
A: Yes, El Salvador became the first country to adopt Bitcoin as legal tender in September 2021 under President Nayib Bukele.
Q: When will Bitcoin City be built?
A: While no official completion date has been set, active port development and cleared regulatory pathways suggest construction could begin in phases starting in 2025–2026.
A New Era of Digital Urbanism
El Salvador’s journey toward building Bitcoin City exemplifies how emerging economies can harness blockchain technology and renewable energy to redefine urban development. The $1.6 billion port investment is not just about upgrading docks and terminals—it’s about laying the foundation for a new kind of city: one built on transparency, decentralization, and innovation.
As dredging begins and equipment arrives at La Unión, the dream of a fully functional Bitcoin-powered metropolis moves closer to reality. Whether this model proves scalable or sustainable remains to be seen, but one thing is clear—El Salvador is betting big on a digital future.
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With strong government backing, private sector partnerships, and growing international attention, Bitcoin City may soon transition from concept to concrete—a symbol of how technology can reshape nations.