Bitcoin City and geothermal energy mining: how volcanoes help El Salvador earn Bitcoin

​The President of El Salvador proposed leasing the country's volcanoes to Bitcoin miners. This is far from Nayib Bukele's first Bitcoin initiative tied to geothermal energy. The leader of the Latin American country has been exploring ways to accumulate BTC for years.

The world’s first Bitcoin nation

El Salvador is globally recognized as the first country to legalize Bitcoin as an official means of payment. This landmark decision was made in September 2021, allowing citizens to pay for goods and services using either USD or BTC.

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President Nayib Bukele aimed to enhance financial inclusion, as a significant portion of the population lacks access to banking services. Bitcoin adoption has also enabled the country to save millions of dollars on international remittances, which form a substantial part of its GDP.The adoption was accompanied by the launch of the state-backed Chivo wallet and the construction of infrastructure to support the new digital economy.

In recent years, El Salvador has been actively increasing its Bitcoin reserves, buying 1 BTC daily. Furthermore, the country is implementing large-scale projects to earn and use Bitcoin, leveraging its natural resources, particularly volcanoes.

Mining with volcano energy

El Salvador began using volcanoes for Bitcoin mining just a month after adopting the cryptocurrency as legal tender. At that time, President Nayib Bukele announced the launch of the first mining farm powered by geothermal energy extracted from volcanoes.

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Mining with volcanic energy allowed El Salvador to integrate innovative technologies into its economy while reducing the carbon footprint of cryptocurrency mining. Since then, nearly 500 BTC have been mined using geothermal energy.

El Salvador continues to develop geothermal projects and plans to expand mining capacity to turn this initiative into a stable source of income. One of the latest initiatives is President Bukele’s proposal to lease volcanoes to Bitcoin miners.

"With 170 volcanoes in El Salvador, the 'rent your volcano for Bitcoin mining' program could make sense," he noted.

Local officials confirmed that they are working on the proposal, and lawmakers will develop a regulatory framework to support the initiative.

Bitcoin City

In November 2021, Nayib Bukele announced another ambitious project—Bitcoin City. The initiative envisions building a city at the base of the Conchagua volcano in eastern El Salvador. This city aims to become an innovative financial and technological hub where Bitcoin serves as the primary medium of exchange.

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The concept of Bitcoin City is directly tied to volcanoes, as the Conchagua volcano is expected to supply geothermal energy for powering the city and supporting Bitcoin mining.

Over time, El Salvador sought funds to implement this project. In August 2024, the country attracted $1.6 billion in private investment from the Turkish holding company Yilport. However, the project’s future remains uncertain, as early investors are increasingly skeptical about its realization.

Volcano bonds

Volcano Bonds are another initiative announced in late 2021. These government-backed securities allow investors to fund infrastructure development related to Bitcoin and cryptocurrency mining using geothermal energy.

The bonds are denominated in USD and offer holders a 6.5% annual yield, along with additional payments tied to Bitcoin’s price growth.

The funds raised through these bonds are intended to finance Bitcoin City construction, develop geothermal energy, and support mining operations.

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In December 2023, El Salvador’s Digital Assets Commission gave the initiative the green light. The bond issuance was expected in Q1 2024, but no new updates on the project have emerged since then.

Bitcoin tourism

El Salvador seeks various ways to earn Bitcoin, including actively promoting Bitcoin tourism. Since legalizing the leading digital asset, the country has become a hotspot for Bitcoin enthusiasts worldwide.

Tourists interested in Bitcoin and its real-world applications visit El Salvador to explore the new financial model and the country’s natural beauty, particularly its iconic volcanoes. Around these sites, numerous businesses accept Bitcoin payments—from souvenir shops to restaurants.

Local entrepreneurs have also embraced the trend, accepting Bitcoin as payment, especially in popular tourist areas like San Salvador and Santa Ana volcanoes. Thus, Bitcoin tourism has become a vital part of El Salvador’s strategy to strengthen its economy and popularize cryptocurrency globally.

Conclusion

El Salvador's government is actively experimenting with various ways to earn Bitcoin. From utilizing volcanoes to implementing large-scale infrastructure projects and promoting Bitcoin tourism, the country is exploring all options. However, not all initiatives are successful. Many projects face financial and organizational hurdles.

Despite the ambitious and unique nature of these efforts, their results remain mixed. While some projects, such as Bitcoin tourism, generate tangible revenue and bolster El Salvador’s reputation as the first Bitcoin nation, large-scale undertakings like Volcano Bonds and Bitcoin City demand significant investments and face skepticism from investors and the public. The experiments with Bitcoin accumulation (over 6,000 BTC so far) highlight the country’s willingness to pioneer but also underscore the challenges of integrating cryptocurrency into a traditional economy.