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El Salvador receives $1.6 billion investment from Yilport, is Bitcoin City set to revive?

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El Salvador receives $1.6 billion investment from Yilport, is Bitcoin City set to revive?

Salvadoran President Nayib Bukele announced that he has secured a $1.6 billion investment from Turkish holding company Yilport for a large-scale port infrastructure project, including the La Unión port, the location of "Bitcoin City." Is the long-awaited Bitcoin City revival finally happening in 2021?

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Yilport Invests $1.6 Billion in Port Construction

El Salvador is set to receive a $1.615 billion investment from the Turkish-owned company Yilport for the development of two ports, marking the largest private investment in the country's history.

The initial phase of investment is set to begin by the end of this year, focusing on enhancing the infrastructure of Acajutla, El Salvador's largest port located in the west of the country, which mainly deals with the import and export of goods such as oil, fertilizers, coffee, and sugar.

Subsequent investments will be made in the port of La Unión, located in the east of El Salvador, which is also the site of the proposed "Bitcoin City."

Is "Bitcoin City" About to Begin Development?

According to previous reports, El Salvador has pledged to build "Bitcoin City" since 2021, situated between the cities of La Unión and Conchagua in the east of El Salvador. The project includes an airport, residential and commercial areas, and a large Bitcoin symbol at the city center.

Nayib Bukele hopes to attract significant foreign investment through this city, promising no income tax, capital gains tax, property tax, payroll tax, or municipal tax. The city aims to achieve zero carbon dioxide emissions by relying entirely on geothermal power from volcanoes. Residents will only be subject to a 10% value-added tax, half of which will go towards repaying Bitcoin bond funds, while the other half will fund public services.

Underwhelming Results in Tokenized Bond Issuance

However, the issuance of volcano bonds initially intended to raise funds seems to have encountered challenges. Bitfinex launched a tokenized debt issuance in April, aiming to raise $6.25 million for the construction and development of comprehensive facilities at the international airport in El Salvador. Reports indicate that Bitfinex only raised $342,000 from investors by the first deadline, leading to a decision to refund investors. Bitfinex hopes to restructure the issuance terms and relaunch fundraising in the future.

The investment from the Turkish-owned company Yilport was solidified during President Bukele's visit to Turkey in 2022.