El Salvador prepares to launch bitcoin bond: ‘If this fails, a lot of doors close’

El Salvador prepares to launch bitcoin bond: ‘If this fails, a lot of doors close’

Josué País, owner of an El Salvador taxi business that accepts payments in bitcoin from the tourists who use the service, is enthusiastically backing the country’s latest plan to cash in on the cryptocurrency craze.

“The curiosity is what gets me,” said País, 36, who was planning to buy about $200 of the central American country’s “bitcoin bond” set to launch this week. “Number one, I’m going to do it to support the country. Number two, because it’s a big, attractive bet.”

The country’s millennial president Nayib Bukele is relying on interest in the bitcoin-backed bond from the likes of País and retail investors worldwide. It was one of the few options left to help bail the nation out of its financial hole, analysts said, but with institutional investors reluctant to participate and the price of bitcoin in decline, the launch may not be a success.

Six months after El Salvador became the first country to make bitcoin legal tender, the government is scrambling for funds to repay and refinance expiring debt. Its sovereign bonds have fallen to junk status in the past year as investors worry that the budget deficit, which the IMF says could reach 5 per cent this year, is