12 • The Sunday Times MagazinePUERTO
RICOCUBAFloridaFloridaGeorgiaDOMINICAN
REBUBLICHAITIJAMAICAUSA
USAO
n a Tuesday night
at the Cannon
Club, a piano bar
in old town San
Juan, Puerto Rico,
accompanied
by sparkling
margaritas, grilled
octopus and a
giant white parrot
called Campeche,
I am inducted
into the future.
I’m with a group
of cryptocurrency
enthusiasts,
thousands of
whom have
moved to Puerto
Rico in recent years, as they plot the
contours of the new world they hope to
build. From the YouTuber Logan Paul to the
former film star Brock Pierce to some of the
biggest early investors in ethereum, these
settlers have been lured to the “Island of
Enchantment” by low taxes and long
beaches. If you thought the champions of
Silicon Valley were utopian and self-assured,
try hanging out with the next generation.
“A lot of us really do think technology
can save the world,” says Evan Arteaga, 38,
who has lived in Puerto Rico for four years.
Arteaga is a former cannabis entrepreneur
who made a small fortune in crypto and is
now helping to launch a tech-enhanced art
and community centre in old San Juan.
“This is the inevitable evolution of the
capital marketplace. I do think this is the
future, we just need to keep going,” he says.
Amanda Cassatt, 31, is the founder of
Serotonin, one the first marketing firms
dedicated to working with crypto
companies. She is also a central figure in the
Puerto Rico crypto movement, having been
“early” into ethereum. “Decentralise
everything,” she says. “Currency is just the
beginning. Decentralise the energy markets.
This is the embryo stage of a new economy.”
People like Cassatt and Arteaga are the
tip of a spear that is driving the digital
economy towards its next phase: Web3,
blockchain and the metaverse. These terms
may be familiar to you by now, or they may
not yet. Either way, you will be hearing them
more and more, because (yet) another digital
revolution is under way that will likely touch
all of our lives, whether we want it to or not.
So what do all these highfalutin phrases
actually mean? What will this revolution
look like? And what kind of a society are
its proponents trying to build? If anywhere
has the answer, it’s Puerto Rico, home to
one of the world’s first cryptocurrency
communities. So I am here to find out more.
The old town of San Juan is not an
obvious place to reimagine the future of
humanity. Dotted with crumbling Spanish
colonial mansions and shabby-chic cocktail
bars, the tropical port regularly plays host tohordes of fat-bottomed American tourists,
who in peak season are disgorged daily from
giant Floridian cruise ships in search of
fridge magnets and piña coladas.
In 2012, though, the government of
Puerto Rico, which is an unincorporated
territory of the United States, passed a
series of acts offering tax incentives to any
American investors who want to relocate.
Drawn by these whopping breaks, year-
round sunshine and the dream of a new
society, as many as 10,000 well-heeled US
migrants, mostly from the world of finance,
have arrived in the Caribbean territory. An
estimated 3,000 of the arrivals are newly
minted cryptocurrency millionaires.
These affluent newcomers to Puerto Rico
have bought up gorgeous properties by thebeach, patronised a clutch of expensive
new restaurants and private schools, and
poured millions of dollars into philanthropy
and development projects to help an
impoverished island community still
reeling from the effects of Hurricane Maria
in 2017. Heavyweight crypto players such
as the hedge fund Pantera and the risk
management firm Darma Capital have
relocated to Puerto Rico.
The new migrants spend their weekends
kiteboarding, boating and hiking through
Puerto Rico’s lush forests, sometimes with
magic mushrooms for company. Many live
in chichi gated communities such as the
Ritz Carlton Reserve in Dorado, which has
a five-acre spa, a water park and a designer
golf course. Property prices have spiked
accordingly, and three-bedroom houses on
the Dorado beachfront are being listed for
$19 million (£14.5 million).
These crypto-utopians — cryptopians?
— have brought their messianic dreams
with them. In recent months Puerto Rico
has hosted cryptocurrency conferences and
set up beginners’ courses for locals to learn
the basics of digital currencies. Perhaps
most important, there are the foundations
of a new Web3 economy being built by
coders, investors, consultants, artists and
engineers who hope to replace the social
media giants that currently dominate the
internet with a far more decentralised
model built using blockchain technology.
What is Web3? The original internet, or
Web 1.0, so the narrative goes, was about
reading and getting information online,
posted by a few creators. Web 2.0, which
arose in the mid-2000s, brought a content
revolution, where users were able to post
their own videos, blogs and music on social
media. But the big tech platforms — Twitter,
Facebook, Google — harvested this data
and used it to take control of the advertising
industry, making a fortune in the process.
In Web3, its proponents claim, digital
currencies and tokens will allow creators to
own a small piece of their own communities.
It will be decentralised and more
democratic, because the data will belong
to the people again and not the giants in
Silicon Valley. That’s the plan at least.
Yet is it a utopia or a dystopia that these
digital dreamers are building on this
troubled island? And what do the locals
think? Critics of the Puerto Rico project,
and there are many both on the island and
in the US media, suggest that the migrants
are rootless digital plutocrats — greedy
neocolonial tax exiles enacting a fantasy
by feasting on Puerto Rico’s desperation.
“They are here dreaming of a utopia
because they have so much money in
their pocket, when people here can’t even
dream about next week,” says Ana Teresa
Toro, a local writer and teacher. “It’s like
a playground for them, the stakes are so
low. It’s like they are having a rehearsal for
a play in our living room.”Evan Arteaga, 38, moved to Puerto
Rico four years ago after making a
fortune in cryptocurrency software