El Salvador’s president slams false reports about its Bitcoin bond

El Salvador's President Nayib Bukele has publicly accused Reuters of spreading "rumors" about why the country's $1 billion "volcano bond" would be delayed, in an attempt to create panic.

El Salvador’s President Nayib Bukele took to Twitter late Wednesday to slam a Reuters report that claimed Binance CEO Changpeng Zhao (CZ) would save El Salvador’s Bitcoin bonds.

“Please do not spread Reuters’ false information,” Bukele said on Twitter to his 3.6 million followers, refuting claims that CZ would come to rescue the project after the $1 billion bond issuance originally scheduled for mid-March was delayed until September. The tweet was in response to a now-deleted Bitcoin Magazine tweet on the issue.

Bukele said the delay in the issuance of the "Volcano Bonds" was mainly due to legislative delays in Congress, and that his meeting with CZ had nothing to do with the bond issuance, and the two of them intended to discuss "other issues."

Paolo Ardoino, CTO of Bitfinex — the company underwriting the bonds — also helped explain Bukele’s case, saying the delay was mainly due to the fact that laws governing the bond issuance still need to be passed by Congress. Samson Mow, former chief strategy officer of Blockstream, El Salvador’s partner in issuing the bonds, also weighed in, tweeting that “nothing has changed.”

Earlier this week, El Salvador’s Finance Minister Alejandro Zelaya said a $1 billion bond issuance originally scheduled for mid-March would be pushed back to September, citing geopolitical uncertainty as the main reason for the delay.

Three hours after slamming the Reuters report, Bukele took to Twitter to complain about the U.S. government in response to a proposed bill that seeks to minimize U.S. influence on El Salvador’s financial system after the country adopted Bitcoin as legal tender. The El Salvador Cryptocurrency Accountability Act passed out of committee on Wednesday and will now be voted on by the full U.S. Senate.

“Never in my wildest dreams did I imagine that the U.S. government would be so scared of what we are doing here,” Bukele tweeted in response to the news, adding that it is “an undeniable fact that the U.S. government does not stand for freedom.”

El Salvador is issuing bonds backed by Bitcoin as a way to accumulate more Bitcoin reserves and to finance the construction of "Bitcoin City," a development project dedicated entirely to Bitcoin and related blockchain technology. It will reportedly use geothermal energy from a nearby volcano to power Bitcoin mining as well as the city's infrastructure. Half of the $1 billion in proceeds will go toward construction costs, with the remaining $500 million to be invested directly in Bitcoin.