El Salvador has introduced a new citizenship-by-investment program, known as the “Adopting El Salvador Freedom Visa Program,” which offers residency and a path to citizenship for 1,000 individuals willing to invest $1 million in either Bitcoin or Tether within the country.
While this program represents a unique opportunity, it comes with a steep price tag compared to neighboring Caribbean nations, where citizenship programs can start as low as $100,000.
The initiative, announced on December 7th, is a collaboration between the Salvadoran government and the stablecoin issuer, Tether.
To participate, potential investors are required to make an initial nonrefundable deposit of $999, which is credited toward the total $1 million investment.
If all 1,000 spots are filled, El Salvador stands to generate $1 billion in revenue, a substantial income source reminiscent of countries like Vanuatu, which annually earns millions through its own citizenship-by-investment program.
Critics, including Alistair Milne, the founder of crypto hedge fund Altana Digital Currency, have deemed El Salvador’s offering as “uncompetitive in the global market.”
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Comparatively, other options exist, such as Malta, which offers citizenship by investment for €750,000 ($810,000), providing access to the EU’s visa-free Schengen Area covering 23 countries.
Additionally, neighboring Caribbean nations like Antigua and Barbuda, Dominica, and St. Lucia grant citizenships in exchange for a $100,000 contribution to sovereign development funds.
Grenada and St. Kitts and Nevis offer similar programs with contributions starting at $150,000 and $250,000, respectively.
Despite the higher price point, El Salvador’s unique appeal lies in its pro-Bitcoin policies initiated by President Nayib Bukele.
These policies include recognizing Bitcoin as legal tender and eliminating income and capital gains taxes for tech companies investing in the country for the next 15 years.
These incentives may attract crypto investors to consider relocating to El Salvador.
However, it’s essential to note that President Bukele’s tenure has also faced controversy, with concerns raised about human rights violations and arbitrary detentions during his efforts to reduce the country’s high murder rate.
Bukele stepped down from the presidency on December 1st to focus on his reelection campaign ahead of the general election scheduled for February 2024.
El Salvador’s new citizenship-by-investment program, while notable, comes with mixed reviews due to its relatively high cost compared to other options and ongoing concerns about governance.
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