What Happened to the World's First Planned Bitcoin City?
By Creatives Takeover Editorial Team · October 8, 2026
The city never rose, but the coins stayed.
In November 2021, just over two months after El Salvador became the first country in the world to treat Bitcoin as legal tender, President Nayib Bukele walked onto a stage at a Bitcoin conference in the Pacific beach town of Mizata and announced he was going to build a city for it. The pitch was easy to picture. The city would sit at the base of the Conchagua volcano on the country's eastern coast, laid out in a circle so that from the air it would look like the Bitcoin symbol. It would have an airport, homes, shops and a central plaza. The volcano would supply geothermal energy to power the city and the computers that mine Bitcoin.
The tax pitch was just as bold. No income tax, no property tax, no capital gains tax. The only tax residents would pay was a 10 percent sales tax, and that money would go toward paying back the debt used to build the place. Bukele compared the project to the cities Alexander the Great founded, and one of the Bitcoin executives on stage with him compared El Salvador's future to Singapore's. It was a vision with a clear identity, which is probably why it spread so fast. A city shaped like a coin, next to a volcano, with no taxes. Few announcements in recent business history have been easier to repeat in a sentence.
A City Built on a Single Price
What got less attention than the shape of the city was how it would be paid for. The plan was a $1 billion "volcano bond," a ten year bond paying 6.5 percent, sold through a Bitcoin focused financial network. Half the money would go to buying Bitcoin and the other half to building infrastructure and mining operations. After about five years, the government would start selling some of its Bitcoin and share the extra profit with bondholders. Construction was supposed to begin about sixty days after the money came in, and the bond itself was supposed to launch in 2022.
Look at that structure carefully and a pattern appears. The city was paid for with money tied to the price of Bitcoin. It was meant to be filled with businesses that make money from Bitcoin. And the bond would only be repaid if Bitcoin went up. Funding, product and repayment all depended on the same number. When it moves in your favor, that feels like momentum. When it moves against you, there is nothing underneath to catch you.
The timing made it worse. The announcement came shortly after Bitcoin hit a record high. Within months, the market turned, and a bond that needed excited investors suddenly had to be sold into a crash.
A Year Later, Still Trees
By September 2022, one year after the legal tender law took effect, Reuters sent a reporter to the site near Conchagua. The land was still covered in jungle. The bond that was supposed to pay for construction had been postponed after the crypto crash. The government was sharing very few details about the project, and had never said how or when construction would start.
Meanwhile, the rest of the Bitcoin strategy was keeping the government busy. It had bought more than 2,300 coins while the price fell. It was also trying to find the money for $1.6 billion in government bonds coming due in 2023 and 2025, and the International Monetary Fund, the global lender that countries turn to when they are running out of options, had asked El Salvador to reverse Bitcoin's legal tender status. Locals raised practical questions too. One critic noted that a new city would need large amounts of drinking water, and water is already a problem in the country's east.
Put those pieces together and the project's chances were already thin. The money depended on a price that had fallen. The lender that mattered most was unhappy. And the project had no construction schedule to point to.
How a Project Disappears Without Anyone Canceling It
Bitcoin City was never officially cancelled. There was no press conference and no statement admitting that it wasn't happening. It simply stopped being mentioned. Coverage of the project notes that Bukele, who posts constantly on social media, has said nothing about it in a long time. An American named Keegan Corbin, who left Chicago after the announcement hoping to become the first resident of Bitcoin City, has become a small symbol of the gap between the promise and what showed up.
This is how a lot of ambitious announcements end. Cancelling a project means admitting it failed, and admitting failure has a political cost. Letting it fade costs almost nothing, because a city with no deadline can never officially miss one. The cost shows up elsewhere, in the attention and money that went into something that never got built.
The Loan That Changed the Rules
What finished off the bigger Bitcoin dream wasn't a market crash. It was a loan. In December 2024, El Salvador reached an agreement with the IMF for a $1.4 billion program over about three years. The country's finances had been described as teetering on the edge of default, and the loan was the lifeline. The price was a rollback of the Bitcoin experiment.
On January 29, 2025, El Salvador's Congress, controlled by Bukele's party, rewrote the Bitcoin law so that businesses were no longer required to accept it. By one account, the first country in the world to adopt Bitcoin as legal tender had become the first to walk it back. The US dollar became the only money anyone was forced to take. The program also limited the government's use of public money to buy more Bitcoin and pushed for El Salvador to wind down Chivo, the government wallet it launched to get citizens using the currency.
A tax free crypto city, built partly on government money and partly on a bond tied to Bitcoin, is hard to fit inside those rules. And the broader verdict from outside observers has not been kind. The Economist concluded that crypto had brought more costs than benefits, and that the promised investment and tourism had been small. Bitcoin simply never caught on as everyday money.
The Part That Survived
Here is where the story gets more interesting than "the city failed." The coins stayed. When the IMF program began, El Salvador held about 5,970 Bitcoin. Today the national reserve is around 7,800, worth roughly $600 to $670 million depending on the day's price. By one tally, it was worth close to $800 million early this year and fell to about $460 million in the summer when Bitcoin dropped under $66,000.
Almost all of that growth happened while the government was officially promising to stop buying. The explanation depends on who you ask. Bukele's government has publicly described buying one coin a day, and crypto press reported a single day in November 2025 when the national Bitcoin Office announced a purchase of 1,090 coins, worth nearly $100 million. The IMF's review this month said the coins added since mid 2025 came from private donations and the merging of existing wallets, not from government money, and released about $138 million of the loan after waiving some missed targets. It also kept the ban on state funded Bitcoin purchases in place and pressed for a deeper retreat from Chivo.
Whatever the right label, the shape of the strategy changed. Bitcoin stopped being a currency that every shop had to accept and became a reserve the government holds, closer to a national savings account than a national experiment. It is quieter, harder to criticize, and tied to a single question: what is Bitcoin worth when the government decides it needs the money?
Why "It Failed" Is Too Simple
The easy conclusion is that Bitcoin City was a project that didn't work out. That undersells what it actually was. A city is a construction project with a budget, a timeline and a builder. Bitcoin City never had a timeline, and its funding depended on a bond that never launched. It was closer to a pitch than a plan, and as a pitch it worked remarkably well. A small country with a famously poor reputation for investment got worldwide attention for months. One commentator described the whole Bitcoin initiative as the greatest rebrand a tiny country ever pulled off.
But attention is not the same thing as a city, and it isn't the same thing as growth. The investment and tourism that attention was supposed to attract stayed small, and the project that was supposed to anchor the whole strategy never left the drawing board. The more useful lesson is about structure: when the money to build something, the thing being built and the way the money gets repaid all depend on the same price, a single bad year can end all three at once.
What a Founder Can Take From a City That Doesn't Exist
Fund the thing with something that doesn't move with the thing. Bitcoin City's bond, its customers and its repayment all rose and fell together. Ask what holds up your plan if your main variable goes the wrong way for a year.
A date and a builder turn an announcement into a plan. The government never said how or when construction would begin. If nobody can say when you will miss a deadline, nobody can hold you to one.
Attention is a result, not a product. The announcement earned months of coverage worldwide, and very little of it turned into investment. Counting headlines tells you what people heard, not what they paid for.
Quiet endings still have costs. Letting a project fade avoids the pain of admitting it failed, but it leaves people waiting, and it tells every future announcement to be taken less seriously.
Your strongest lender decides your strategy. The IMF didn't have to ban anything. It simply made the loan depend on the rollback, and a country close to default took the loan.
The next test is already on the calendar. The IMF will keep reviewing El Salvador's Bitcoin, and each review has to answer the same question about where those added coins really came from. The land near the Conchagua volcano will keep waiting for an answer of its own.