Capital markets News

Bitfinex Securities to facilitate El Salvador tokenized commercial debt

hampton by hilton hotel

Bitfinex Securities El Salvador announced plans for a $6.25 million tokenized debt security to fund the construction of a Hampton by Hilton hotel complex at the airport. The developer, Inversiones Laguardia S.A. de C.V. (HILSV), is the issuer of the five-year 10% coupon note.

A quick search on the company reveals it contracted to build an airport hotel in 2017, although it’s entirely possible that was a different hotel. As an incentive to the tokenized debt investors, the hotel operator is offering free hotel accommodation based on the investment size. The minimum investment is $1,000.

Nowadays the vast majority of branded hotels are franchised. At the end of 2023 Hilton Worldwide owned just 51 of the 7,530 Hilton hotels. It managed another 800 and franchised 6,679.

The HILSV tokens will be issued in May on the Liquid Network, a Bitcoin sidechain launched by Blockstream. Settlement is in US dollars or Tether tokens. 

Bitfinex Securities facilitated the first tokenized security denominated in Tether stablecoins last year. More recently, it facilitated a $5.2 million issuance in Kazakhstan. So, El Salvador and Kazakhstan are the two jurisdictions where it is regulated. El Salvador was the first country to recognize Bitcoin as legal tender.

It is a subsidiary of Bitfinex, the crypto exchange that is the sister company of the Tether stablecoin. You may recall that the New York Attorney General reached a settlement with the stablecoin firm banning it from New York. That’s because Tether lent $625 million of its reserves to the Bitfinex exchange to cover a shortfall.

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