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Blockchain migration: narratives of lived experiences in Puerto Rico at the dawn of a new digital era

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Blockchain migration: narratives of lived experiences in Puerto Rico at the dawn of a new digital era

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BLOCKCHAIN MIGRATION:
NARRATIVES OF LIVED EXPERIENCES IN PUERTO RICO
AT THE DAWN OF A NEW DIGITAL ERA

by

Sarah Clayton

A Dissertation Presented to the
FACULTY OF THE USC GRADUATE SCHOOL
UNIVERSITY OF SOUTHERN CALIFORNIA
In Partial Fulfilment of the
Requirements for the Degree
DOCTOR OF PHILOSOPHY
(COMMUNICATION)

May 2022

Copyright 2022 Sarah Clayton

ii
Acknowledgments
This dissertation reflects the incredible relationships that I have built with numerous
generous and inspirational individuals from the UK, the University of Southern California
(USC), and Puerto Rico. First, I would like to thank my loving family and especially my parents,
Nigel and Lorraine, for their continuous and valuable support over the years. They always told
me that a good education is something that cannot be taken away from you and there are so many
things that I would never have done had they not emphasised the importance of education
throughout my life. This dissertation is for you, mum and dad. I love you and I hope I have made
you proud.
I am also sincerely grateful to both Professor Graham Dutfield, who became my adopted
advisor during my Master’s degree at Leeds University, and my good friend and UK academic
partner in crime, Edward Morris. Without both of your recommendations to consider going back
to school to get a doctorate, I would not be where I am today. Thanks a million for the
inspiration and confidence you gave me. Further sincere appreciation to Edward, as during my
graduate career, you have helped me to achieve my full potential through encouragement when I
was flagging, kicking my ass when I needed it, and guiding me through and helping me
overcome writer’s block and self-doubt. Our friendship over the past 10+ years has meant a great
deal to me and really has stood the test of time.
I would like to express my deepest gratitude to my academic advisor Jonathan Aronson,
whose continuous support, encouragement, and guidance has helped me to improve, learn, and
grow as a researcher, and ultimately embark upon this life-changing dissertation journey. I am
grateful for your patience and generosity with your time and your remarkable ability to open
doors for me, cheer me on, and provide continuous, prompt, and constructive feedback

iii
throughout my academic experience and dissertating process at USC. I would also like to express
gratitude to my fantastic committee members Manuel Castells and Hernan Galperin who have
supported, encouraged, and guided me during my time at USC, as well as Bhaskar
Krishnamachari who graciously introduced me to many smart, talented blockchain scholars and
permitted me to take his blockchain class, which was primarily aimed at computer science PhD
students in the Engineering Department. Additional thanks to the other faculty members, staff,
and graduate student colleagues who have supported me along this milestone of learning.
This project is the brainchild born from a short conference trip to Mayagüez and Rincón
in Puerto Rico in 2018. The free 2018 conference, Restart Week West, was an economic
development and social improvement initiative to ‘restart’ and rebuild the island of Puerto Rico
following the devastation caused by Hurricane Maria the previous year. My original plan was to
attend Consensus in New York, one of the largest blockchain conferences in the world, but
something in my gut drew me towards Puerto Rico instead. I had bumped into numerous people
on the conference circuit up and down the west coast who talked enthusiastically about Puerto
Rico after attending one or more blockchain events on the island and/or because of the well-
known blockchain community members who had relocated there. As a result, I surrendered to the
idea and decided to trust the universe. I travelled to Puerto Rico on my own, without any
contacts, funding the whole trip myself. I somehow knew I had to be there, without
understanding why.
Chapter 1 opens with a short description of the interactions that sparked my interest and
ideas for this dissertation. I am eternally grateful to the Restart Week West organisers, including
Adam Krim and Brock Pierce, who delivered an enjoyable eye-opening and educational event,
especially for someone completely new to Puerto Rico who was only prompted to find it on the

iv
map by the publicity emerging from the blockchain community in the United States. I am also
thankful to the Puerto Rican women who disrupted the smooth running of the day on Monday 14
May 2018, as without their passionate interruptions, I doubt this dissertation would have been
written.
After returning home from Puerto Rico, I was meditating on the event and realised that
what I had witnessed was a contentious public debate over migration concerns; an all-too-
common issue across modern societies. What was distinct from other migration-related contexts,
however, were the utopian claims from the new arrivals about the promise of technology to solve
complex problems on the island. There was a lot to digest from my trip and I decided that my
dissertation had to be based in Puerto Rico. After browsing the academic literature on topics
relating to my 10-day Puerto Rican experience, I subsequently wrote my prospectus on
migration, privilege, and societal and cultural transformation, and applied for funding. Several
months later, while I was walking around Little Tokyo in LA and serendipitously wearing a t-
shirt with the words “Puerto Rico” splashed across the front, I received an email offering me a
fellowship to complete my doctoral dissertation research in Puerto Rico. I am sincerely grateful
to the Annenberg School for the nomination and the USC Graduate School’s selection committee
for awarding me the Research Enhancement Fellowship that enabled me to conduct the research
for this dissertation.
While my trip in May 2018 suggested there were many blockchain migrants on the
island, I had relocated in June 2019, in the middle of the bear market, and I was not sure how
many blockchain migrants had remained. Consequently, soon after arriving on the island, I
remember feeling overwhelmed by the task in front of me. Where was I going to find my
participants? Thankfully, I discovered some wonderful general networking and crypto-specific

v
meet-up groups that enabled me to hit the ground running on my project. I am forever grateful to
Pedro Rivera, the San Juan organiser of the weekly CryptoMondays events, who did an
incredible job of introducing me to the crypto community in Puerto Rico and making me feel
welcome. In addition, I am sending huge appreciation to Brian Bourgerie and Drew Cutkomp,
co-founders of Uncommon EntrePReneurs. Many thanks to all three of them for organising and
hosting such fantastic events; without those networking opportunities and especially in the early
days of my research, many of my participants would have been much harder to find.
I would also like to extend my gratitude to Ghost who I bumped into in a mountainous
area in the middle of the island, far from San Juan, as I was about to conduct my first interview
for this project. Your support and friendship from that day forward seriously influenced my
Puerto Rican experience and the outcome of this work. The friends and contacts that you
introduced me to comprise some of the most accomplished and interesting people I have ever
met. Thanks also for the kind birthday present. When my hard drive was stolen from the
Monastery, I lost huge amounts of data and countless sentimental photos and videos. Your
thoughtful gift helped me to buy a replacement and learn an important lesson about cloud
storage.
I would like to sincerely thank all the wonderful staff who work and volunteer at the San
Juan Community Library or the Jane Stern Dorado Community Library for being so welcoming
and friendly. Thank you for allowing me to spend extensive hours working on your desktop
computers and, in the case of the San Juan Community Library, for introducing me to your
incredible Puerto Rican collection; books which were invaluable for completing chapter 3 of this
project. I am also extremely grateful to Berto Cartagena for your friendship and support and

vi
allowing me to work for weeks from your apartment, especially as finding a quiet working
environment during the pandemic was incredibly challenging.
Much of this dissertation would have been impossible without the COVID-19 pandemic.
The policies arising from the virus enabled me to remain in Puerto Rico and continue collecting
data, which was significant as 2020-2021 saw a substantial migration pattern shift in response to
the change in administration, the crypto bull run, and, of course, the coronavirus outbreak.
Moreover, living within the culture over a much longer period than initially envisioned, enabled
me to acquire intimate knowledge of the blockchain migrant population and establish maximum
trust and rapport with them. I am not thanking anybody for the unsettling and frightening
COVID-19 situation, but it is worth a mention as it certainly affected the results of this project.
Finally, I would like to sincerely thank all 28 interviewees, who willingly and generously
shared their time and provided invaluable insights and encouragement. Thank you all so much
for your contributions to my research and your help, support, and guidance. Alongside my
research objectives, this project provides a record of history as it unfolds. While it is not a total
history or an all-encompassing historical document, I hope it serves as a glimpse into the
evolution of blockchain migration, provides an alternative perspective to what has been written
in other publications, and fills a conspicuous gap in not only the academic literature, but also the
documented history relating to such migration to Puerto Rico. Much of the information included
in this study was furnished by my interviewees and I owe you all a huge debt of gratitude as
without you, I would not have been able to complete this project. (Note, several participants
requested that I publish their contributions under a pseudonym.)
Nicolas (Nico) Billeaud
BitsAndMore
Annie Mustafa
Brock Pierce

vii
Brian Bourgerie
Justin Breen
Drew Cutkomp
David De Sevilla
John Divine
Leigh Ferreira
Ghost
Jonathan (Jon) Kutsmeda
Beck Lee
Yarey Melendez
Giovanni Mendez
Gregory Raz Mueller
Erick Pinos
Monika Proffitt
Antares Ramos
Pedro Rivera
Alexander Robinson
Andrés Rua
Valeria Salazar
Rusty Shackleford
James Shaw
Jennifer Simms
Kyle Wang
Jorge Williams
Thanks again to everyone who contributed to the success of this study. It has been an honour and
a privilege.

viii
Table of Contents
Acknowledgments........................................................................................................................... ii
List of Tables ................................................................................................................................ xii
List of Figures .............................................................................................................................. xiii
Glossary of Terms ..........................................................................................................................xv
Abstract ..........................................................................................................................................xx
Chapter 1 Introduction .....................................................................................................................1
Study Purpose and Research Questions ...........................................................................................4
Methodology ....................................................................................................................................9
Sampling methods ..........................................................................................................................10
Interviews .......................................................................................................................................11
Participant observation...................................................................................................................12
Social media ...................................................................................................................................13
Data analysis ..................................................................................................................................13
Reflection on My Positionality and Experiences ...........................................................................14
Study Justification ..........................................................................................................................16
Chapter Organisation .....................................................................................................................18
Chapter 2 Literature Review ..........................................................................................................21
The Blockchain Ecosystem ............................................................................................................22
Migration and Privilege .................................................................................................................25
Lifestyle migration .........................................................................................................................26
Relative privilege ...........................................................................................................................28

ix
Network Building...........................................................................................................................30
Work, Entrepreneurship, and Mobility ..........................................................................................32
Lifestyle mobility and digital nomadism .......................................................................................34
Tax-Induced Migration ..................................................................................................................37
Colonialism and Colonial Entrepreneurship ..................................................................................39
Techno-Utopianism........................................................................................................................42
Globalisation and Inequality ..........................................................................................................44
Chapter Conclusion ........................................................................................................................45
Chapter 3 The Puerto Rican Context .............................................................................................47
About Puerto Rico..........................................................................................................................47
Geography ......................................................................................................................................47
Population ......................................................................................................................................48
Climate and natural disasters .........................................................................................................49
Political status ................................................................................................................................50
Tourism ..........................................................................................................................................50
History of Puerto Rico ...................................................................................................................51
Juan Ponce de León: From occupation to unyielding colonisation ...............................................53
The replacement of Taíno slave labour in the plantation system ...................................................54
Defending Puerto Rico from European attacks .............................................................................55
Towards independence from Spain ................................................................................................57
The American invasion ..................................................................................................................58
The Americanisation of Puerto Rico..............................................................................................59
Political developments and contentions .........................................................................................63

x
Economic development ..................................................................................................................66
Migration under American rule .....................................................................................................70
Government policy and the U.S. migration boom .........................................................................74
Act 20 and Act 22 ..........................................................................................................................75
Act 60 .............................................................................................................................................77
Blockchain migration .....................................................................................................................81
Chapter Conclusion ........................................................................................................................87
Chapter 4 Blockchain Migrant Lifestyles ......................................................................................89
Participant Demographics ..............................................................................................................89
Histories, motivations, and migration patterns ..............................................................................93
Migrant Culture: “Similar Threads and Themes” ........................................................................112
The freedom mindset ...................................................................................................................113
Hacker culture and risk-taking behaviour ....................................................................................121
Californian ideology ....................................................................................................................129
Population Density, Local Networks, and Community Integration .............................................138
Gender diversity (or lack of) ........................................................................................................148
Chapter Conclusion ......................................................................................................................156
Chapter 5 Entrepreneurship, Technology Diffusion, and Cultural Challenges ...........................158
Cryptocurrency Taxation and Regulation ....................................................................................158
Innovation and Entrepreneurship .................................................................................................161
Innovation ....................................................................................................................................166
Technology diffusion and knowledge transfer ............................................................................171
Business challenges .....................................................................................................................182

xi
Act 22 and Cultural Divisions......................................................................................................192
Non-profit competition ................................................................................................................194
The real estate boom ....................................................................................................................200
Rule changes ................................................................................................................................204
Investment via incentives .............................................................................................................206
Power Dynamics ..........................................................................................................................207
Cultural differences and contentions ...........................................................................................211
Chapter Conclusion ......................................................................................................................225
Chapter 6 Migration Futures and Broader Impacts......................................................................229
References ....................................................................................................................................243
Chapter 1 ......................................................................................................................................243
Chapter 2 ......................................................................................................................................245
Chapter 3 ......................................................................................................................................256
Chapter 4 ......................................................................................................................................262
Chapter 5 ......................................................................................................................................265
Chapter 6 ......................................................................................................................................268
Appendix ......................................................................................................................................269

xii
List of Tables
Table 3.1. Act 20 (The Export Service Act) Benefits, Rules, and Amendments.......................... 78
Table 3.2. Act 22 (The Individual Investors Act) Benefits, Rules, and Amendments. ................ 80

xiii
List of Figures
Figure 3.1. Puerto Rico: Main towns, roads, and rivers (Geology, 2021) .....................................48
Figure 3.2. Puerto Rico’s Population, 2000-2017 (Trines, 2018) ..................................................72
Figure 3.3. Puerto Rican Population in Puerto Rico and the United States, 2000-2019
(Centro, 2020) ................................................................................................................................72
Figure 3.4. Post Maria Out-Migration (Leger, 2019) ....................................................................73
Figure 3.5. Bitcoin price history and block reward halvings (Sense and Cents, 2021). ................85
Figure 4.1. Act 20 and Act 22 application volumes through 30 June 2020 (Weiss & Wyss,
2021) ..............................................................................................................................................98
Figure 4.2. PR Relocate email 19 May 2021, noting the relocation deadline for the 2021 tax
year ...............................................................................................................................................109
Figure 4.3. Thick Red Line Project card ......................................................................................114
Figure 4.4. Lakeside cabins where migrants would hold social events in 2020-2021 .................124
Figure 4.5. Camp Decentral at Burning Man, 2018 (Breezy, 2018) ............................................132
Figure 4.6. Popular places for blockchain migrants (and other expatriates) to live ....................138
Figure 4.7. Local real estate advertisement for Dorado Beach: “Barefoot luxury at its finest!” .140
Figure 4.8. Pedro Rivera hosting CryptoMondays at the Red Monkey bar in Old San Juan:
15 July 2019 (pre COVID-19/crypto bull run) ............................................................................143
Figure 4.9. BTC Miami WhatsApp Group ..................................................................................147
Figure 5.1. Diffusion curve and bell curve (Lechman, 2018, p. 54) ............................................171
Figure 5.2. Local campaigns to address the brain drain ..............................................................174
Figure 5.3. Total Employment and GDP, 1950-2018 (Econometrika Corp, 2021) .....................193
Figure 5.4. Toys ready to be wrapped for underprivileged local children, Christmas 2020 .......200

xiv
Figure 5.5. PRelocate mailshot advertising a high-end luxury home for sale, 2 August 2021 ....202
Figure 5.6. Typical local houses, south of Puerto Rico Highway 26 (PR-26), close to Ocean
Park ..............................................................................................................................................203
Figure 5.7. Protest graffiti in San Juan, a popular location for migrants to live ..........................218
Figure 5.8. Social media art by myartisnotpolitical .....................................................................220
Figure 5.9. “Go Home Gringo” graffiti on the Departamento de Estado (Department of the State)
building, in Old San Juan during the Ricardo Rosselló protests..................................................223

xv
Glossary of Terms
Altcoin Alternative cryptocurrencies launched after Bitcoin
AMA Ask Me Anything
Bay Area San Francisco Bay area
BEN Blockchain Education Network
Bitcoin The first decentralised cryptocurrency
Bitcoin halving When the bitcoin miners’ block reward is halved, which serves to
increase bitcoin’s scarcity over time
Blockchain A blockchain is a distributed digital ledger, on which network
participants validate and process transactions, and group them into
blocks, which are added to the end of a continuously growing chain of
blocks, listed in chronological order. A typical blockchain is
decentralised, immutable, transparent, and secure.
BTC Bitcoin
Bull run A period in the market when prices are on the rise, market confidence is
high, and demand outweighs supply
CapEx Capital Expenditure
CBDC Central Bank Digital Currencies
CECFL Comisión Especial Conjunta de Fondos Legislativos para Impacto
Comunitario (Special Joint Commission of Legislative Funds for
Community Impact)
Coinbase One of the largest crypto exchanges

xvi
COVID-19 Coronavirus infection that turned into an ongoing global pandemic from
2019
CPA Certified Public Accountant
Crypto Cryptocurrency
DAO Decentralised Autonomous Organisation
DapCoin The token for Dapp Inc.
DDEC Department of Economic Development and Commerce
DeFi Decentralised Finance
Divi A cryptocurrency
Dogecoin A popular cryptocurrency (meme/joke token)
Donate PR Act 22/60 Community Donation Platform
Ethereum A cryptocurrency with a blockchain platform on which smart contracts
can be built
Expat Expatriate
EY Ernst & Young Global Limited - multinational professional services firm
FBI Federal Bureau of Investigation
FinTech Technology used to support or enable banking and financial services
FOMB Financial Oversight and Management Board for Puerto Rico (La Junta de
Control/Supervisión Fiscal)
GDP Gross Domestic Product
GILTI Global Intangible Low-Taxed Income, which is income earned abroad by
foreign affiliates of U.S. companies and is subject to special treatment
under the U.S. tax code

xvii
Gringo A person, typically an American but can also be someone from another
English-speaking country, who is not Hispanic or Latino
IBE International Banking Entities
ICO Initial Coin Offering
IDA Industrial Development Authority (in Ireland)
IFE International Financial Entities
IPO Initial public offering
IRS Internal Revenue Service
KPMG Klynveld Peat Marwick Goerdeler, a multinational professional services
firm
LEAN A methodology for optimising the people, resources, effort, and energy
of your organisation toward creating value for the customer
Liquidity
provision
In DeFi, crypto holders can add crypto to a liquidity pool, which is
essentially a group of funds locked in a smart contract. In return,
liquidity providers can earn trading fees from trades occurring in the pool
Mastercoin/Omni A protocol layer built on the Bitcoin blockchain to support decentralised
projects
MIT Massachusetts Institute of Technology
MMA Mixed Martial Arts
MMT Modern Monetary Theory
NFT Non-Fungible Token
NSA National Security Agency
OZ Opportunity Zone

xviii
PDP Popular Democratic Party
POS Proof of Stake
Pharma Pharmaceutical Industry
PNP Partido Nuevo Progresista (New Progressive Party)
PREPA Puerto Rico Electric Power Authority
Prepper A person who gathers materials and makes plans in preparation for
surviving a major disaster
PRIDCO Puerto Rico Industrial Development Company
PROMESA Puerto Rico Oversight, Management, and Economic Stability Act
Python An object-oriented computer programming language
R&D Research and Development
ROI Return on Investment
SEC U.S. Securities and Exchange Commission
Six Sigma A set of management techniques intended to improve business processes
by greatly reducing the probability of errors or defects
Stablecoin A cryptocurrency that’s pegged to a non-crypto asset, such as the U.S.
dollar
Staking Receiving rewards for locking up tokens, which are used to verify
transactions and secure a Proof of Stake (PoS) blockchain network
Supply Chain A network between a company and its suppliers to produce and distribute
a specific product to the final buyer
SUT Sales and Use Tax
TCJA Tax Cuts and Jobs Act

xix
Telegram An end-to-end encrypted mobile messaging application
Tether A stablecoin pegged to the U.S. dollar
UN United Nations
USC University of Southern California
WhatsApp A mobile messaging application
Yield farming Lending crypto to others via smart contracts and earning crypto in return
(i.e. putting assets to work)
Zoom A cloud-based video communications app

xx
Abstract
Most of today’s blockchain literature resides in the fields of engineering, computer
science, business, and law, and the social impact of the technology and broader societal benefits
and challenges are overlooked. This dissertation project investigates the lifestyle migration of
blockchain migrants and potential and actual resulting technology diffusion in Puerto Rico, with
a concentration on: (1) Migration stories: lifestyles, expectations, aspirations, and experiences;
(2) Blockchain technology diffusion: innovation, education, and entrepreneurship; and (3) Social
and material transformations: economic development, cultural dynamics, and political
organisation. Data derives from informal interviews with blockchain migrants and individuals
who interface professionally with these migrants on the island, participant observation at
industry and local events, and the analysis of conversations on social media platforms.
Blockchain migrants in Puerto Rico are people who have typically, but not always, qualified for
advantageous tax incentives, such as Act 20/Act 22 or Act 60, and who are working (or, prior to
moving, have worked) in the blockchain space, whether personally (e.g. day trading) or
professionally (at a company). The study seeks to provide insights into the social impact of
blockchain-related migration. Its findings may be pertinent to other locales that encourage
similar migration through government policies that are targeted at economic growth via foreign
investment.

1
Chapter 1 Introduction
During the week commencing May 11, 2018, several innovation-related events took
place in Mayagüez and Rincón as part of Restart Week West, an economic development and
social improvement initiative to “restart” and rebuild the island of Puerto Rico. Each day saw
events, activities, and exercises designed to engage participants in developing ideas for solving
the difficulties Puerto Rico was facing after the collapse of its public finances alongside the
devastation caused by Hurricane Maria.
What was particularly interesting about the Restart initiative, which actually began two
months’ prior with Restart Week in San Juan, was that a large proportion of participants were
U.S. citizens from the crypto
1
/blockchain
2
community, who were looking to establish or had
already established residency in Puerto Rico; generally because of the tax benefits afforded by
Act 20 and Act 22.
3
Consequently, many events - which included panel discussions and
collaborative workshops covering topics such as energy, economic development, education, and

1
Crypto should be read as synonymous with cryptocurrenc(y)ies.
2
Blockchains are distributed immutable ledgers of transactions made within a network, that facilitate efficient
exchange of digital assets, including tokenised assets such as cryptocurrencies. Many blockchains also support smart
contracts, which are executable programs stored and agreed upon by participants in the corresponding blockchain
network.
3
Act 20 and Act 22 are tax incentives to attract new residents and capital investment to improve the economy of
Puerto Rico. Passed in 2012, Act 20 provides for a 4% corporate tax rate and Act 22 affords a 0% capital gains tax
rate. Although, as of January 1, 2020, Act 60 has replaced Acts 20 and 22, and all applicants must instead comply
with the requirements of Act 60 (see Chapter 3).

2
agriculture - focussed on how blockchain, a general-purpose technology, could be used to
enhance the lives of people living on the island.
On May 14, about half an hour into a panel discussion about education, innovation, and
technology with local university students and a moderator from the United States, a Puerto Rican
protester took the microphone and criticised the lack of stakeholder representation at the event,
especially as the predominantly mainland attendees were talking about redesigning society on the
island (McConnell, 2019). The moderator and panellists responded politely and invited the
woman to join them on the stage, which she respectfully declined, but after this brief exchange,
the tone of the debate became considerably more heated.
In between passionate interruptions, and statements about the promise of blockchain
technology for the island, another Puerto Rican protestor took the microphone to voice anger
about loss of land to U.S. interests, U.S. dependency, colonialism, and misplaced priorities – as
water, shelter, food and medicine, not technology, were urgently needed for hurricane season and
beyond (McConnell, 2019). These exchanges cultivated a rowdy atmosphere that was difficult to
control, and the session erupted into a raucous, uncensored debate, which exposed the significant
misconceptions and misunderstandings between the protestors and event attendees. The
attendees wanted to figure out how to “unite” together with the local community “as a we”, and
the protesters, while recognising that the participants probably had good intentions, expressed
strong concern that any outcomes from the Restart initiative had the potential to make it more
convenient for U.S. citizens and corporations with bad intentions to encroach upon their soil. The
protesters exclaimed that they had the talent and education to achieve all the things that the
attendees wanted to help with on the island; the only thing that Puerto Ricans did not have was
money. The unruly session closed with protesters continuing to assert that the Restart Week

3
West attendees were “threatening their land” (Abuchaibe & Brown, 2018; Positive Mass Films &
Silverstone, 2018; McConnell, 2019; Cotler & O’Brien, 2019).
The day’s chaotic proceedings highlighted some of the tensions stemming from Puerto
Rico’s colonial relationship with the United States government and the complexities of relations
on the island caused by increased movement of people, practices, and technologies, to and from
the mainland. More broadly, they pointed to the harsh realities of inequality and asymmetries of
power, the contentions associated with relatively privileged mobility, and the potentially
disruptive effects of migration processes on society.
The lively exchange with Puerto Rican residents attracted some negative media attention
from NPR, The Guardian, and other outlets, which also likely harmed the reputation of the
event’s organisers and participants, and their mission to help Puerto Rico (Abuchaibe & Brown,
2018; Positive Mass Films & Silverstone, 2018; McConnell, 2019; Cotler & O’Brien, 2019).
While the Restart initiative was launched in 2018 amid much fanfare, it fizzled out over time as
the leading participants did not want to take on the responsibility of continuing it any further –
perhaps due to the negative press. The most recent Restart event was held in Ponce on 25-30
October 2018.
There are many regular events on the island that attract the blockchain community, and
other expatriates and locals, and they often provide a platform for local charities and
organisations to promote their work, such as Uncommon EntrePReneurs, events run by the Act
20/22 Society and the Act 20/22 Club, and CryptoMondays, a weekly event primarily attended
by blockchain migrants. Popular conferences also include CoinAgenda, BitAngels, and Disrupt
Puerto Rico. Local networking events and industry conferences help community members -
which comprise countless entrepreneurs - connect with other entrepreneurs and bridge structural

4
gaps to acquire new information, financial resources, ideas, support, and potential leads and
customers (De Klerk & Saayman, 2012).
In early 2018, The New York Times published a highly influential article on the
blockchain/crypto ecosystem in Puerto Rico, titled Making a Crypto Utopia in Puerto Rico,
(Bowles, 2018). It prompted a wave of individuals involved in the blockchain space to relocate
to the island and take advantage of the tax benefits. More recently, the increase in remote
working due to policy changes associated with the COVID-19 pandemic, the change of
administration to a Joe Biden Presidency (who proposed raising taxes for upper-income
individuals), and the crypto bull run of 2020-2021, have led to increased migration to the island
of people wanting to benefit from both Act 60 (the decree that replaced Act 20 and Act 22 on 1
January 2020) and the migrant networks in place. The United States charges an exit tax to people
who renounce their citizenship and it’s the only country in the world that taxes its citizens on
their worldwide income, even if they live abroad. Although Puerto Rico’s tax system is
independent from the United States, migrants from the mainland to Puerto Rico are not required
to pay the exit tax as they can maintain their U.S. citizenship. Thus, relocating to Puerto Rico
provides a way for U.S. high capital gains earners, especially during the 2021 crypto bull market,
to adjust to changing tax policy and minimise the impact on their investments.
Study Purpose and Research Questions
Much of the existing research into relatively privileged migration is driven by neo-
colonialism and points to the idea that individuals often display a sense of cultural superiority
through both human and financial capital, as well as material, symbolic, and political resources,
which are not comparable to their local neighbours. It tends to focus on lifestyle migration,
examining identity-making processes and the pursuit of a better way of life, (see, for example,

5
Benson (2013)). Such research views the dominant purpose of movement as being leisure-
activity led, rather than being driven by a combination of factors including lifestyle, but also
economic and entrepreneurial concerns.
Prior academic blockchain-related migration research primarily focuses on settler
colonialism, computational capitalism, and sustainable development (Crandall, 2019; Howson,
2020; Jutel, 2021). While associated academic research in this area is quite sparse, press
coverage regarding the lives and impact of blockchain migrants can be found in abundance,
especially pertaining to Puerto Rico. Most coverage is sensational in tone and takes a negative
stance when describing their lives (see, for example, the NPR audio documentary titled: Puerto
Crypto (Cotler & O’Brien, 2019)). The stories are usually framed around Brock Pierce and his
inner circle and/or disaster capitalism, and they often incorrectly assume that the migrant
community is being led by Brock and his vision for the island. Most migrants are not close to
Brock; in fact, the community lacks any centralised structure, and the migrants possess a
multitude of ambitions and expectations for both their own lives and the island more generally.
Although factors, such as Puerto Rico’s contentious relationship with the United States are
important, this study concentrates on topics often overlooked by both academics and journalists,
including migration stories, lived experiences, attitudes, values, and behaviours. Migration
histories highlight the varying routes to and motivations for migration and understanding the
everyday lives and experiences offers insights into how and where the migrants are positioned
within the local social structure. This shift in focus gives a different perspective and provides a
multi-level analysis and evaluation of privileged migrants in locales attractive to blockchain
founders, investors, advisors, and enthusiasts.

6
The empirical research in this dissertation derives from two years spent in Puerto Rico
meeting and interacting with members of the blockchain migrant community and local Puerto
Ricans (Boricuas), learning about and participating in blockchain and cultural events, and
following conversations on social media. The project has been designed to investigate the
lifestyle migration of blockchain migrants and the potential and actual resulting technology
diffusion in Puerto Rico. It concentrates on: (1) Migration stories: lifestyles, expectations,
aspirations, and experiences; (2) Blockchain technology diffusion: innovation, education, and
entrepreneurship; and (3) Social and material transformations: economic development, cultural
dynamics, and political organisation. It was informed by network theory and social practices
around the emerging culture of migration. As such, this dissertation spotlights the following
broad research questions:
(i) What role do blockchain migrants see themselves playing in Puerto Rico (if any)? How
do they position themselves in relation to the local Puerto Rican community (economically,
politically, legally, socially, culturally, professionally)?
This question points to the various hats that individual migrants wear in their everyday lives, to
better understand how their presence contributes to the evolving history and status of Puerto
Ricans and Puerto Rico more generally. Activities such as running businesses, participating in
local politics, attending protests, running events, attending recreational groups, and working with
local volunteer organisations and charities, impact local integration and shape island
development.
(ii) How do Puerto Rican societal norms and values impact the blockchain migrants? How
have blockchain migrants adjusted their lifestyles, and navigated the norms, social structures,
and regulations of Puerto Rico?

7
Second, migrants must navigate and adjust to a new lifestyle and culture, which can take time.
Many will experience “culture shock”, a psychological stressor resulting from the need to adjust
to new lifestyles, living conditions, and business practices, when confronted with cultural
differences in Puerto Rico, such as the slower pace of life, differing attitudes, and unreliable
bureaucracy (Ferraro & Briody, 2015). How migrants cope with their new surroundings will vary
between individuals. Some will possess a high degree of cross-cultural motivation and view
Puerto Rico as a place for professional and personal growth, which could accelerate and improve
their overall adjustment. Others may only move for financial reasons, i.e. to take advantage of
the tax decrees, and as such, they may be ill suited to living in Puerto Rico and thus struggle to
overcome the effects of “culture shock” (Ferraro & Briody, 2015).
(iii) What are the cultural norms of the blockchain community in Puerto Rico? What are their
values and how do these values express themselves economically, politically, legally, socially,
culturally, and professionally?
Third, shared assumptions, expectations, and beliefs are reflected in everyday interpersonal
interactions within the social structure of the blockchain community and are reflected in the
community’s relationship with society at large. Existential concepts such as freedom, innovation,
and autonomy are central tenets in the evolving blockchain ecosystem in Puerto Rico. Practical
application of such values manifests more broadly in actions and in subtle cultural shifts and
personal relationships.
(iv) How are the blockchain migrants perceived by the local population?
Fourth, the social integration of migrants and their alleged benefits to the economy and
innovation is a critical issue for the sustainability of Puerto Rico’s tax incentives. Some Puerto
Ricans may welcome migrants and view them as essential to develop and improve localities and

8
livelihoods. Others may feel hostile towards the newcomers for perceived unequal treatment.
Consequently, those in power may decide to enact policies to attempt to redress the balance.
Such moves may hinder the migrants from being broadly accepted into Puerto Rican culture and
may deter others from relocating to the island.
(v) How is/will blockchain technology being/be used on the island? Are there any
blockchain-related projects that are improving conditions on the island? Are there any uses of
blockchain technology on the island that are making conditions worse?
Fifth, the migrants bring skills, knowledge, and expertise. They are particularly well versed in
blockchain technology and understand its potential to revolutionise a multitude of industries.
Consequently, some individuals are pushing for more regulatory clarity to spur innovation on the
island. Many have also started companies on the island that operate in the blockchain and/or
cryptocurrency space. Some enterprises will have a direct impact on island life, while others will
not.
(vi) How and what social and material transformations are unfolding on the island? Can any
of these transformations be attributed to the blockchain migrants? If there has been any
pushback to these changes from the local community, why did it occur?
Finally, many of the social and material changes brought about by the blockchain migrants
depend firmly on social structures and governance frameworks. Government policies that create
a favourable tax environment for foreign investment have played a key part in the growth and
flow of migration, and they are fundamental in mitigating or contributing to any adverse effects
and reinforcing positive or negative outcomes. Local culture in Puerto Rico also differs
significantly from the mainland in terms of common attitudes, expectations, norms, and values
and as a result, the migrants and locals may not always get along. The migrants’ often poor

9
command of the Spanish language marks them as outsiders and resentments may arise due to
Puerto Rico’s contentious colonial history and/or the relative affluence of the newcomers which
locals may perceive as driving land and property prices upwards in certain localities and creating
visible wealth disparities across the island.
Methodology
My research used a range of methodological approaches, including semi-structured
interviews, participant observation, and social media analysis, within a broader case study
framework (Benbasat et al., 1987). The case study method enabled a multi-perspective analysis
as the interactions between pertinent groups of participants were analysed in addition to each
individual participant’s voice and perspective (Tellis, 1997). It facilitated the understanding of
the “nature and complexity of the processes taking place” within their own context (Benbasat et
al., 1987, p. 370); thus, the “holistic and meaningful characteristics of real-life events” could be
retained (Yin, 2009, p. 4). As increasing numbers of the newly minted crypto rich and crypto
entrepreneurs have been relocating to tax havens across the world to protect their wealth, the
case study method was appropriate; particularly in Puerto Rico, as blockchain migration has been
a feature on the island for a long time - since early 2016 - when Michael Terpin first moved from
the mainland.
Enough rapport needed to be built to increase the likelihood that participants would
behave naturally, enabling authentic information to be gained (Frey, 2018). Thus, to encourage
individuals and associates from the blockchain community to discuss their views with me, I
needed to participate sufficiently to make contacts and build trust. I also had to remain cognisant
of relative power dynamics and my “situational identity” to avoid being viewed as representing
or supporting the beliefs or aims of any community or individual (Norman K. Denzin, 2008, p.

10
167). I commenced with “descriptive observation”, annotating as much as possible under the
general question, “What is going on here?” (Spradley, 2016, p. 73), to grasp the complexity of
the field. This enabled me to develop more focused observations based on narrower themes and
perspectives later.
Interviews were supplemented with periods of participant observation at community
meetups (e.g. CryptoMondays) and other local events between November 2019-2021, attended
by members of the blockchain community as well as local Puerto Ricans and other expatriates.
Inferences from intercorrelations of observables (e.g. norms and values) aided data triangulation
and the gathering of relevant ideas for inclusion in interview questions. My research questions
and data gathered from interviews and participant observation guided the organising structure for
the textual analysis of WhatsApp groups and social media forums where I observed topics,
dialogue, and discussions.
Sampling methods
Most interview respondents were approached at local events and activities and a small
number were contacted via snowball sampling. My analysis focused primarily on blockchain
migrants in Puerto Rico who I defined as individuals who had typically, but not always, qualified
for advantageous tax incentives, such as Act 20/Act 22 or Act 60, and who were working (or,
prior to moving, had worked) in the blockchain space, whether personally (e.g. day trading) or
professionally (at a company). Variance was reflected in the sample group by considering
motivations for migration. Interview participants were sampled across a lifestyle to
crypto/blockchain work spectrum. They either relocated primarily for perceived lifestyle
enhancement, a balance of work (any) and leisure, to work at a company that utilised blockchain
technology, or to qualify a blockchain/crypto company under Act 20 or Act 60. Thus, my sample

11
had high levels of socio-economic variability and included a range of individuals from the crypto
space, from pure lifestyle migrants to individual traders and investors to company CEOs. It is
often assumed that all blockchain migrants – especially in Puerto Rico – are wealthy, but this is
not always the case. Several participants had no desire to apply for the tax incentives as it didn’t
make financial sense for them to do so, or they were not eligible.
Individuals who professionally interfaced with blockchain migrants on the island were
also identified at local events and via snowball sampling. I obtained a range of perspectives from
this group who were working or collaborating with blockchain migrants at non-profits or
commercial enterprises operating in a variety of sectors. The variance was reflected in the type of
work carried out by the interviewees and their attitudes towards the blockchain migrant
population. Although the sample was too small to draw firm conclusions, the data provided some
insights into the local impacts of blockchain migration.
Interviews
Data primarily relied on in-depth semi-structured interviews with 21 blockchain
migrants, and seven members of the local population in Puerto Rico, who had interacted
professionally with the migrants between November 2019-2021. Interviews comprised the hows
of participants’ day-to-day lives (how order is produced in everyday life), and the whats (the
activities in everyday life) (Fontana & Frey, 2000). Most interviews comprised an initial coffee
meeting, after which the participant decided whether to move forward with the more formal
interview. While the majority of interviews were conducted in person, a small number were
conducted using Skype or Zoom or over the phone due to the coronavirus pandemic. Interviews
lasted for between 15 minutes and 3.5 hours; most took an average of 1.5 hours.

12
Questions generally focused on migration narratives (migration motivations, prior
knowledge about Puerto Rico, and day-to-day lived experiences), blockchain technology
diffusion (blockchain technology impact on the island, involvement in blockchain projects,
attendance at blockchain-related events, etc.), entrepreneurship (challenges, opportunities, etc.),
tax incentives (rule following, privacy concerns, economic benefits, etc.), and opinions on Puerto
Rico more broadly (culture, natural disasters, politics etc.). Seven semi-structured interviews
with participants who had interacted professionally with those in the blockchain ecosystem, but
were not directly involved in it, and had not necessarily migrated to Puerto Rico, were also
conducted, including with local professionals and representatives from the local business,
community, and non-profit organisations. Questions for this group focused mainly on social and
material transformations and their involvement with/the impact of/their opinions on the
blockchain community in Puerto Rico.
Participant observation
Interviews were supplemented with data from participant observation. This mostly
involved informal interactions with blockchain-related individuals and locals and listening to
people at events, at parties, at protests, at informal gatherings, in shops, on the street, in cafes,
etc. Enough rapport needed be built to increase the likelihood that the participants would act
naturally in order for authentic information to be gained (Frey, 2018). Thus, in order for people
to be prepared to discuss their views with me and allow me to attend relevant events and
meetings to discuss island issues, I needed to participate sufficiently to make contacts and build
trust while avoiding being viewed as representing or supporting the beliefs or aims of any
subgroup, and remaining cognisant of the relative power dynamics and my “situational identity”
(Denzin, 2008, p. 167). While the community had a low bar to access, some individuals, such as

13
the extremely wealthy, were harder to establish trust with and were initially somewhat suspicious
of my intentions. The tight-knit community meant that my reputation in it was important to gain
access to the group, and the extended time spent with the blockchain migrants enabled me to
establish respectful and on-going relationships, observe behaviours, and experience the lifestyle.
Trust was further built by offering small sections of my work to participants who were directly
involved with the study to read. Many were keenly interested in my findings and were looking
forward to reading the complete document. My positive relationships with blockchain migrants
throughout the duration of the research study meant that I was regularly invited to private events,
parties, and activities. The conversations that took place during periods of participant observation
highlighted positive and negative aspects of living in Puerto Rico as an expatriate and as a local.
Deeper insights into the local impacts of blockchain migration and the migrants’ day-to-day lives
were gained from attending public events and more exclusive functions throughout the study.
Social media
My research questions and data gathered from interviews and participant observation
guided the organising structure for the analysis of user-generated social media content, including
WhatsApp groups and Facebook pages, popular with the blockchain migrants where I observed
topics, dialogue, and discussions. These forums provided information on migration, local events
and activities, and day-to-day living in Puerto Rico.
Data analysis
Interviews were recorded, transcribed verbatim, and imported into NVivo 12, a
computer-assisted qualitative data analysis application, which facilitated the qualitative data
analysis process. Interview transcripts varied in length from three to 70 pages of single-spaced
text, averaging 40 pages. Interview files were allocated a case classification depending on the

14
type of participant: (1) Blockchain migrant; (2) Local professional. The data was analysed using
a grounded theory approach, with open codes identified and assigned to sections of interview
text (Corbin & Strauss, 2015). All participants completed a demographic questionnaire either on
Qualtrics or hard-copy paper, and their data was inputted into NVivo as an attribute value against
their case. The classification sheet was exported and served to provide an overview of the
participants in the study. Some participants requested to be identified via a [self-chosen]
pseudonym rather than their actual name.
Field notes, photos, and videos were used to document observations and were hand coded
based on the interview codes in NVivo 12. Screenshots of user-generated social media content
were also hand coded. Relevance was determined based on how closely topics aligned with my
research questions, data gathered from interviews, and participant observation. The most salient
themes in line with the research questions guided the presentation of the findings.
Reflection on My Positionality and Experiences
Researcher subjectivity is a vital aspect of qualitative research. My own subjectivity
certainly impacted the analysis of the day-to-day lives of the blockchain migrant population in
Puerto Rico. Personal biases, and preconceptions may have influenced data collection and the
interpretation of findings and is to be expected. Initially, I was treated by some blockchain
migrants with suspicion. Some believed that I was working for an intelligence agency,
attempting to gather information for the state, and identifying as a PhD researcher appeared to be
a good cover story. Over time, however, I was able to build trust and rapport with them. Having
previously conducted research into blockchain technology and digital assets, I was able to speak
their language and participate effectively in the community. I was also able to benefit from my
professional background and position as a PhD student because, by their standards, I was viewed

15
as an engaging and knowledgeable individual, and therefore blockchain migrants tended to view
me as equal to them. I was invited to countless activities and events, including some at private
locations, because of the trust that I’d built with the blockchain migrant population over time. In
addition, being a British citizen, and not a Puerto Rican or an American, enhanced the expression
of more critical views on some topics in interviews with both the blockchain migrant and local
Puerto Rican populations.
It also must be noted that this study was carried out at a unique point in history, when
COVID-19 was a global threat. Data collection commenced before the pandemic, and continued
during the lockdown situation, and after the economy reopened. Interview questions and access
to participant observation opportunities evolved over time as the global situation developed. As
such, the replicability of certain aspects of the study is in doubt. However, the triangulation of
methods in addition to my long-term immersion in the field enabled me to capture diverse
perspectives on the lives of the migrants and thus enhanced some of the replicable factors.
Most participants were happy for their names to be included in the study; however, a
small number requested that I protect their identities by publishing their contributions under a
pseudonym. Other people’s names including those quoted by participants were redacted or
changed to pseudonyms, unless the individuals were participants in the study or were prominent
personalities with well-publicised views. Some respondents also requested not to be quoted
directly. On the occasions I provide direct quotes from informal conversations, explicit
permission was requested and granted. All participants were aware that their contributions were
going towards a PhD dissertation.

16
Study Justification
Puerto Rico is a particularly interesting case, as relatively wealthy blockchain migrants
enjoy an endless vacation, “living on a tropical island, with great people, with great weather, and
great piña coladas”, and paying little to no tax (Klein & Feeney, 2018). Between 2017 and 2018,
the blockchain community in Puerto Rico was rumoured to have grown by 200 percent (Paris,
2018). Further, from 2019 to 2021, the weekly CryptoMondays event grew from an average of
15 attendees at the Red Monkey bar in Old San Juan to an audience averaging 70 people,
depending on capacity of the chosen venue. Unlike the blockchain migrants, local Puerto Rican
residents do not receive equivalent individual investor Act 22/Act 60 tax benefits, unless they
have lived outside Puerto Rico (1) for at least 15 years prior to when Act 22 was first enacted, or
(2) for at least six years prior to when Act 22 was updated in July 2017, or (3) for at least 10
years prior to when Act 60 was enacted in January 2020. Moreover, residents pay exorbitant
local taxes such as the 11.5 percent sales tax, the highest unitary sales tax in the entire United
States.
Between 2017 and 2019 the population declined from 3.3 million to 3.1 million (Centro,
2020). Immediately after Hurricane Maria, 129,848 people left the island. Many relocated to the
mainland and became homeless in the process, without the necessary resources to return to
Puerto Rico (Guinn, 2018; Hernández, 2018). Of the island residents that remained, more than
82,000 fell behind on their mortgage payments and risked losing their homes (Goldstein, 2018).
Further, the unelected Financial Oversight and Management Board (FOMB) planned the sale of
Puerto Rico’s public resources, infrastructure, and assets to private entities at “fire-sale” prices
(Klein, 2018). Indeed, private company Luma Energy took over Puerto Rico’s Electric Power
Authority on June 1, 2021, under a 15-year contract. Hundreds of schools closed and were either

17
sold for little money or abandoned altogether. Countless individuals and companies from the
mainland bought land and/or property. Chapter 2 of Act 60 for individual investors even requires
individuals to purchase a primary residence within two years of obtaining the tax exemption
decree. The government has been encouraging gentrification-caused displacement in order to
attract outside investment to help repay the island’s $73 billion debt to bondholders (which was
caused at least in part by the purchase of high-risk capital appreciation bonds; many experts
argue that these bonds were illegal under the Puerto Rican Constitution (Bhatti & Sloan, 2016;
Carlo Altieri, 2016)).
Countries, states, and territories create diverse and varied initiatives to attract foreign
investment [and build favourable business environments] to encourage economic growth and
development. Spain pioneered “residential tourism”, for example, to attract investment from
second home owners (O’Reilly, 2014), and Ireland enticed primarily U.S. multinational
corporations to open manufacturing plants and offices by offering low tax rates, employment
creation-tied grants, and a channel for strong representation to the government via the Industrial
Development Authority (IDA) (Breznitz, 2007). Moreover, national policies can serve to actively
welcome and shape new and emerging industries. Several small countries and territories, such as
Bermuda, Malta, Gibraltar, the Cayman Islands, and Liechtenstein have passed blockchain-
friendly laws to attract crypto companies and in turn, create jobs and generate tax revenue
(Martinez, 2018; Popper, 2018). In America, Wyoming has passed bills supporting blockchain
technology and tokenisation to diversify beyond and supplement its struggling coal industry;
many blockchain companies have consequently established a presence in the state. In addition to
simply spurring economic growth, such policies and initiatives can set the stage for societal and

18
cultural transformation. These processes are further shaped by migration and the vagaries of
power.
In a departure from previous research, this study’s emphasis shifts from settler
colonialism, computational capitalism, and sustainable development to the lived experiences,
attitudes, values, and behaviours of migrants. It looks at migration stories, technology diffusion,
and social and material transformations for insights into the social impact of this migration,
which is primarily brought about by government policies that create a favourable tax
environment for foreign investment. This change in focus offers a new perspective to examine
the complex and entangled factors that shape the lives of privileged migrants in locales attractive
to blockchain founders, investors, advisors, and enthusiasts. As such, this study highlights the
micro and meso fundamentals of the migrants’ lived experiences in Puerto Rico and aims to
provide a unique and balanced perspective on their lives.
Chapter Organisation
The study is divided into two main parts. Chapters 1-3 outline and analyse the research
context, whereas chapters 4-6 comprise data analysis and interpretation. Its structure is as
follows:
This introductory chapter 1 provides a brief background on the research context by
identifying the structural conditions that produce and shape blockchain migration to Puerto Rico
and outlines the research methodology for the study.
Chapter 2 provides a literature review on privileged migration and how it intersects with
broader societal structures. Starting with an overview of the blockchain ecosystem, it highlights
the complexity and multidimensionality of the linkages between migration, mobility, networks,
colonialism, and ideology.

19
Chapter 3 offers a comprehensive historical review of Puerto Rico and the broader
geopolitical conditions that have shaped it. Specifically, it introduces the island’s generous tax
incentives and other dynamic economic, political, and sociocultural conditions that have
encouraged blockchain migration.
Chapter 4 introduces my participants, their diverse backgrounds, motivations behind
migration decisions, and varied routes to migration. Their narratives uncover distinct evolving
conditions that prompted their migration as, over time, the blockchain migrant networks and the
sizable expat community on the island have become the principal attraction for new arrivals,
rather than the tax incentives. It also considers personalities and the everyday lives of the
migrants. It demonstrates that their hacker ethic, Californian ideology, and entrepreneurial spirit
have melded to create an environment ripe for innovation, replicating the San Franciscan
mentality of the 1960s and beyond. This chapter also provides insights into how the flexibility
and active agency of migrants underscored by their decisions to operate around normative
conceptualisations of time enables them to create the freedom to devote their lives to activities
meaningful to them, such as growing their business or spending time with friends and family.
Chapter 5 considers how blockchain migration brings about new opportunities in
innovation and entrepreneurship, together with technology diffusion and knowledge transfer. As
I demonstrate, job creation, and opportunities for growth and development are not without
challenges due to government bureaucracy and red tape. It further highlights how inequalities in
wealth, power, access to resources, and lifestyle breed a certain amount of resentment and fuel
local scepticism towards migration and the tax incentives, which negatively impacts the media’s
portrayal of the migrants.

20
Chapter 6 brings together the key tenets of blockchain migration, highlighting the cultural
practices and consequences of such migration, as well as the relationship between culture, digital
knowledge, entrepreneurialism, and the ability to migrate from one place to another, and the
broader evolving intersections of work, mobility, and lifestyle.

21
Chapter 2 Literature Review
The explosion of interest, investment, and enthusiasm in the blockchain ecosystem in
recent years, together with unprecedented wealth creation, has encouraged companies and
individuals to relocate to tax havens and other locales that align with their needs, values, and
interests. Although many migrants are already economically privileged and financial incentives
may be the primary motivator for migration, other factors, such as the weather, personal and
professional networks, business opportunities, and quality of life may be prioritised as part of
their settlement decisions. As these migrants bring new knowledge, skills, and ideas, and a
diverse range of pre-migration experiences, the social and cultural balance of the destination
country/territory will undoubtedly be affected.
Blockchain-/crypto-related migration is a new phenomenon and so far, research focused
in this area is relatively underdeveloped. Canadian author and journalist, Naomi Klein, touches
on the social impact of the blockchain migrants in Puerto Rico, while broadly probing ‘disaster
capitalism.’ In The Battle For Paradise: Puerto Rico Takes on the Disaster Capitalists and in
articles such as Puerto Ricans and Ultrarich ‘Puertopians’ are Locked in a Pitched Struggle
Over How to Remake the Island, she reports on how governments, corporations, and investors,
exploit large-scale disasters, such as Hurricane Maria, to fast-track the implementation of radical
policies, such as deregulation, privatisation of public services, and austerity laws, that rebuild
society to benefit a small elite rather than the wider population (Klein, 2018; Klein & Feeney,
2018). Although a handful of journalists have reported on the blockchain and crypto industry
players in Puerto Rico, little academic research has investigated the societal impact of their
migration on Puerto Rico or on other locales of interest to the blockchain migrant population.

22
This chapter provides a literature review on privileged migration and how it intersects
with broader societal structures. Starting with an overview of the blockchain ecosystem, it
highlights the complexity and multidimensionality of the linkages between migration, mobility,
networks, colonialism, and ideology.
The Blockchain Ecosystem
Celebrated by libertarians and cypherpunks, blockchains afford freedom from domination
by others, because users can have complete control over their assets without the need for
traditional centralised [so-called trusted] intermediaries. The technology enables transactions
such as taking out a loan without a bank, executing a contract without a lawyer, or buying stocks
without a broker (D. Z. Morris, 2014). Technological fetishism, brought about through perceived
liberation of individuals from the state and large corporations, is at the heart of early crypto
discourse. This desire to transact outside of the state’s control and avoid participation in
traditional social institutions stems from the “central libertarian tenet of distrust for ‘the man’”
(Baker, 2015, p. 354).
The cryptocurrency community has matured in recent years. What was once a community
of geeky anarchists, has morphed and grown into a community of professionals, entrepreneurs,
subject-matter experts, commentators, and traders; but a significant libertarian group remains.
Some libertarians have been leveraging their resources (including their crypto fortunes) to build
physical idealistic communities where likeminded residents can partake in utopian activities, and
generally live “the good life”.
Chad Elwartowski, a software trader, devoted libertarian, and early bitcoin adopter
commenced a seasteading project; building a city comprising 30 3D printed, smart, SeaPods off
the coast of Panama. Roger Ver, an early bitcoin investor and CEO of Bitcoin.com, announced

23
plans to raise money through a project called Free Society, in order to purchase land from a [yet
to be identified] government to create a “non-country” and persuade fellow libertarians to
quickly populate it. Vít Jedlička, a former economist, built the Free Republic of Liberland, a
virtual, tangible micronation situated between Croatia and Serbia that runs on bitcoin, bitcoin
cash, and ethereum cryptocurrencies, with bitcoin as the reserve currency.
Many [early] cryptocurrency investors have quickly amassed vast wealth. Bitcoin alone
has created thousands of millionaires. Many of these fortunate individuals have reinvested their
gains into other cryptocurrencies and/or blockchain-based start-ups to help ensure future returns
(Raskin, 2013; Simonite, 2013; Robinson, 2017; Dale, 2018). Some also earn passive income by
yield farming or staking in Decentralised Finance (DeFi) applications.
4
Others have used their
new-found riches to travel and/or relocate to exotic parts of the world (Bernard, 2018; Hanrahan,
2018; Crandall, 2019; Jutel, 2021). Beyond financial resources, these wealthy individuals can
bring unique and diverse skills and expertise, entrepreneurial flair, and new ideas, which may
affect the general economic and social development of the local community wherever they
relocate.
In addition to investment from individual enthusiasts, institutional investment has poured
into the blockchain ecosystem, as the business world recognised the potential of the technology
to disrupt [almost] every industry. By 2018, consulting giants EY, KPMG, Deloitte, and
Accenture had set up new divisions to offer blockchain consulting and solutions services (Zhang
et al., 2020). In 2020, PayPal announced their integration of cryptocurrency payments and
between 2018 and 2021 J.P. Morgan, Morgan Stanley, Goldman Sachs, and Fidelity began to

4
Yield farming (also called liquidity mining) is a process for cryptocurrency holders to use various strategies to
generate the most returns (in tokens) possible by locking up their assets; whereas staking involves receiving rewards
for locking up tokens to ensure the security of a Proof of Stake (PoS) blockchain network.

24
provide digital asset services (Franck, 2021; Nelson, 2021; Ponciano, 2021). In 2019, J.P.
Morgan launched JPM Coin, a digital stable coin to facilitate instantaneous payments using
blockchain technology (J.P. Morgan, 2021). Central banks are building central bank digital
currencies (CBDC), in Jamaica, China, Sweden, the EU, Marshall Islands, and the Bahamas; and
other countries, including the United States, Singapore, U.K., South Korea, Japan, and Canada,
are discussing the development of CBDCs (Redman, 2021). In June 2021, El Salvador made
bitcoin legal tender, akin to the U.S. dollar, making it easier for citizens living abroad to send
remittances home. President Nayib Bukele also announced that El Salvador would grant
citizenship to anyone who owned at least three bitcoin (Renteria et al., 2021). Recently, DeFi has
started to decentralise the digital economic system, and disrupt financial intermediaries by
offering products such as cryptocurrency lending and deposit services, something that the
traditional banking system has not accomplished. In addition, non-fungible tokens (NFTs) are
revolutionising digital asset and data ownership in the realms of identity, gaming, digital art, and
collectibles. Moreover, start-ups continue to create novel blockchain applications and platforms
for countless industries, including energy, education, finance, governance, agriculture, and
media.
Most blockchain literature still resides in the fields of engineering, computer science,
business, and law. The social impact of the technology and broader societal benefits and
challenges are overlooked. Blockchains and blockchain-based applications are being developed
with little concern for potential social pitfalls and other externalities, such as the cycle of poverty
and inequality. Industry players, and especially those on the libertarian side of the political
spectrum, tend to embrace freedom, accept risk and uncertainty, and grasp opportunities created
by innovation and emerging technologies (Faria, 2019; Feeney, 2020). Accordingly, many are

25
quite nomadic, tend to take an entrepreneurial, often lucrative career path, and seek geographic
locations with the greatest financial incentives (Crandall, 2019). In this era of transnationalism,
this group personifies unboundedness and globalisation. Many are highly mobile professionals,
who could be considered “cosmocrats” that are “defined by their attitudes and lifestyles, rather
than just their bank accounts” (Micklethwait & Wooldridge, 2003, p. 230).
Migration and Privilege
There is a rich literature on the relationship between migration and privilege that
espouses extrinsic and intrinsic motivations such as available leisure activities, preferred
landscapes, warm climates, and self-realisation and fulfilment (Benson & O’Reilly, 2009a,
2009b; Croucher, 2012; Hayes, 2015; Lawson, 2016). It represents a departure from typical
migration studies research, which tends to focus on the economic organisation of production and
labour in migration and portrays the migrant as a victim lacking agency (Lewis, 1954; Massey &
España, 1987; Todaro & Maruszko, 1987; Massey, 1990; Massey et al., 1993, 1999; Portes &
Bach, 1985; Sjaastad, 1962; Todaro, 1969; Olwig et al., 2013; Brug et al., 2015; Ferris &
Donato, 2019; Samaddar, 2020). Among the literature, the associated more privileged migrant
categories include: residential tourists and second home owners (Breuer, 2005; Mantecón &
Huete, 2011); retirees (Casado-Díaz, 2006; King et al., 2000); lifestyle entrepreneurs (Dewhurst
& Horobin, 1998; Ateljevic & Doorne, 2000; Shaw & Williams, 2004; Stone & Stubbs, 2007;
Guercini & Cova, 2018; Guercini & Ceccarelli, 2020); and ‘adventure seekers’ (Croucher, 2012;
Pavelka & Draper, 2015). These relatively affluent migrants find it easy to relocate due to
holding passports from powerful countries and possessing financial assets and resources such as
property, pensions, and incomes (Benson & O’Reilly, 2016). Thus, privileged migration research
raises issues of structure, agency, and power, which are intrinsically linked concepts. Knowles

26
and Harper (2009) highlight the “slack and slippage” of typical terms in the literature (e.g.
“economic migrants”) associated with relatively privileged migrants from economically
developed countries, as boxing individuals into neat categories tends to impute limited intentions
and thus oversimplifies the motivations of migrants (p. 11). For example, some migrants have
limited financial capital, but possess cultural capital that derives from cultural knowledge,
education, and habitus, which can also enable migration. Thus, Knowles and Harper (2009)
emphasise the need to observe the multiplicity of motives and a sliding scale of differences
between migrants, and suggest that lifestyle migration is an appropriate entry point as it covers a
multitude of circumstances and motivations beyond economic factors, such as income and job
advancement.
Lifestyle migration
‘Lifestyle migration’ is a concept, not an objective category of migration that can be
measured with quantitative data (Benson & O’Reilly, 2016). It considers the relative ‘choice’
and ‘possibilities’ afforded to privileged migrants, who are “people whose resources enable them
to move elsewhere with a choice of possibilities available for a different, often better, lifestyle”
(Lawson, 2016, p. 20). These individuals take up residency in a different place to enjoy the
lifestyle it offers. McIntyre (2016) defines such migration as “the movements of people, capital,
information, and objects associated with the process of voluntary relocation to places that are
perceived as providing an enhanced, or at least, different lifestyle” (p. 194). Akin to other forms
of migration, it interfaces with processes of globalisation and spatial restructuring, in terms of
cross-border flows and its organisation through transnational networks (Castells, 2010). More
specifically, as Benson and O’Reilly (2009b) observe, it relates “to the relative economic
privilege of individuals in the developed world, the reflexivity evident in post-/late modernity,

27
the construction of particular places as offering alternative lifestyles, and a more general ease (or
freedom) of movement” (p. 620). The research focus is the “motivations behind a residential
move” (Huete et al., 2013, p. 333). Some lifestyle migrants deploy what Hayes (2014) describes
as “geographic arbitrage”; they relocate themselves, their finances, and other resources they
accumulated elsewhere to a lower-cost environment where they can free up capital and fulfil
their aspirations for a particular lifestyle. Consequently, they tend to have high purchasing power
to access more resources, which consequently affords them more freedom in the receiving
country (Huete et al., 2013). Other lifestyle migrants have lower levels of social, cultural, and
economic capital, compared to other populations, which makes certain lifestyle migrants –
particularly aging migrants – vulnerable to discordant experiences relating to a lack of economic
or political rights, and other concerns (Benson & O’Reilly, 2016, p. 29).
Lifestyle migration is often conceptualised around the maximisation of quality of life.
Benson and O’Reilly (2009a), for example, describe it as “the spatial mobility of relatively
affluent individuals of all ages, moving either part-time or full-time to places that are meaningful
because, for various reasons, they offer the potential of a better quality of life” (p. 2). Some
scholars have sought to avoid the somewhat vague ‘quality of life’ definition as all migrants “are
aiming to enhance their quality of life” (Croucher, 2012, p. 4). They “are pulled to a new land by
the promise of improved economic well-being and pushed from their homelands by the belief
that the security or comfort they desire is unattainable there, or at least less easily attained”
(Croucher, 2009, p. 178). Therefore, as Williams and Hall (2002) suggest, (1) migrants can’t be
classified into neat groupings, and (2) motivation factors exist on a continuum. This has led
Benson and O’Reilly (2016) to acknowledge the limitations of their lifestyle migration definition
while contending that it is still valuable to recognise the role of lifestyle in migrants’ lives, to add

28
nuance to the complexities among the drivers and consequential impacts of migration. Thus,
Benson and O’Reilly (2016) suggest that each conceptualisation of migration should be
employed for the set of analytical tools it offers, which provide answers to different questions as
each concept stems from distinct intellectual, methodological, and theoretical traditions, rather
than using lifestyle migration and other migration concepts to group migrants into distinct
categories. Lifestyle migration research emerges from qualitative and ethnographic research, and
focuses on people, not places, to explore identity-making processes that are rooted in these
migrations (Benson & O’Reilly, 2016).
Relative privilege
Privilege articulated as the “right” sort of migrant is a common theme in the literature
(Benson & O’Reilly, 2018; Sang & Calvard, 2019; Lawson, 2017). State actors create rules and
conditions to attract and retain those who fit the profile of their ideal candidate to move and
invest. These form part of the ideological context that structures, limits, and explains migration
patterns and migrant behaviour. Relative, as opposed to absolute, framing of privilege is
important within migration, as privileged migration occurs in the context of economic power
differentials between sending countries and receiving countries. Scholars, including Fechter and
Walsh (2010) and Benson and O’Reilly (2018) stress that the lived experiences of relatively
privileged migrants often reproduce social, structural, and material inequalities and make visible
unbalanced power relations and knowledge practices, which can stem from historical processes.
Studying American migrants in Mexico, Croucher (2009) demonstrates how American migrants
possess not only human and financial capital and cultural and political resources related to the
United States, but they also “have access to and embody the material and symbolic resources
associated with America, both as a world superpower and Mexico’s dominant neighbour to the

29
north” (p. 170). As such, those who have migrated to Mexico tend to possess better houses, cars,
and clothes, and dine at better restaurants compared to what they could afford in the U.S, as well
as display “a sense of cultural superiority” (p. 73), which stems from American attitudes and
values such as individualism and a free-market ideology. Migration is their response to
increasing health care costs, shrinking pensions, and an uncertain economic future in the United
States. Comparatively, von Koppenfels (2014) stresses that the “difference in power” between
the sending and receiving country is vital, as demonstrated by American migrants to Europe who
are not able to live in relative luxury and replicate a neo-colonial experience. Thus, von
Koppenfels (2014) asserts that “the line between lifestyle migration, or privileged migration, and
economic, or labour, migration is a blurry one” (p. 26). Not all north-south migrants are lifestyle
migrants. Similarly, Carrillo (2009) in his study of gay Mexican migrants to the United States
emphasises the need to consider the multiple motivations for migration pertaining to particular
population groups as, in contrast to what might be stereotypically posited, not all south-north
migrants are forced or economic migrants. Further, relative power is exemplified through the
implications of labels pertaining to specific migrations. Expatriatism implies power and freedom
from the restraints of home and expatriate carries assumptions of affluence, privilege, and self-
segregation (E. Cohen, 1977; Backer, 1987). These migrants are “defined by reference to where
they come from rather than where they are”, which stems from “the difference-in-power
relationship between the country of origin, to which the individual seeks to retain a very close
relationship, and the host country” (Guild, 2013, p. 20). Comparatively, economic migrants,
labour migrants, asylum seekers, immigrants, and refugees, are usually individuals who need to
leave their home country and are generally perceived more negatively compared to expatriates.
They tend to economically benefit from the receiving country; whereas expatriates are typically

30
depicted as having something to offer their community of destination (Jaji, 2019). Therefore, it is
important to acknowledge the positive and negative connotations that arise from the use of these
terms, due to what they convey politically and culturally as well as their associated power
dynamics and social interdependencies.
Network Building
The literature widely acknowledges that all migration is a network-building process that
helps reduce the economic, social, and emotional costs of movement. This large body of research
builds on chain migration research by MacDonald and MacDonald (1964), who also identified
impersonally organised migration as another migration process. Chain migration is defined as
“that movement in which prospective migrants learn of opportunities, are provided with
transportation, and have initial accommodation and employment arranged by means of primary
social relationships with previous migrants” (MacDonald & MacDonald, 1964, p. 82). As more
migrants move to a place it becomes easier for similar migrations to occur in the future. These
networks are social relationships that “connect migrants, former migrants, and non-migrants in
origin and destination geographies through ties of kinship, friendship, and shared community
origin” (Massey et al., 1993, p. 448). Network theory assumes that migration at one point in time
alters the context for future migration, as once a critical threshold of migrants is reached, the
costs and risks of future movement from the sending country are significantly reduced. Thus, the
probability of further migration and additional movement is increased, which in turn expands
migrant social networks. While network theory cannot explain why unassisted migrants decide to
move (but see, for example, Somerville, 2011 for research into pioneering migration), many
migrants are hugely influenced by their participation in ethnic, family, professional, and
friendship networks containing individuals who have already migrated and can aid the decision-

31
making process, as well as help them adjust personally and emotionally to the new location.
Moreover, former experienced migrants can teach cost-saving shortcuts and strategies and
newcomers can lower their costs by travelling with other migrants and staying with their friends
and/or family when they arrive (Massey & España, 1987). Network ties also can help newcomers
gain access to employment, and provide assistance and support in other areas, such as finding
accommodation or learning how to use public transportation after they move. Network theory
recognises that migration is an ongoing process; it “depends on and, in turn, reinforces social
relations across space” (Portes & Bach, 1985, p. 10). Migrant networks represent a form of social
capital that “gives a powerful momentum to the migration process” (Massey & España, 1987, p.
733). Therefore, migration is “self-perpetuating because each act of migration creates the social
structure needed to sustain it” (Massey et al., 1999, p. 46).
Many researchers find that positive feedback from movers who are content in their new
location and therefore intend to remain for an extended period of time, or indefinitely, are more
likely to push for friends and relatives to join them, compared to those who are dissatisfied with
the experience (Teteryatnikova, 2013; Burholt, 2004; Khoo, 2001; Morad & Sacchetto, 2020;
Audebert, 2020). MacDonald and MacDonald (1964) and subsequent researchers generally focus
on chains in the migration flows of individuals from low social-economic backgrounds, and find
networks often provide a model for migrant behaviour (see, for example, Chamberlain, 1999;
Lever-Tracy & Holton, 2001). Comparatively, higher-status migrant groups receive less attention
in the literature. Two exceptions are O’Reilly (2013) and Johnston et al. (2006). O’Reilly (2013)
demonstrates how British migrants to the Costa del Sol form migrant social networks and
community structures, which increases the chances of additional movement, especially because
British tastes are well catered for (since many migrants are self-employed) and English is often

32
spoken by the locals. The research also reveals how tourism flows contribute to the likelihood of
an area being developed for subsequent mass migration of middle and upper occupational and
income groups. Johnston et al. (2006) find that skilled migrants to New Zealand rely less on
migrant networks for migration assistance or to seek employment or housing, as the “nature of
contemporary labour markets, information transmission media and the opportunities for
international travel mean that potential migrants have many more sources of information about
opportunities - including their own experience - in other countries than was available even four
decades ago” (p. 1247). Dekker and Engbersen (2014) support this claim as their evidence
suggests that online social networks aid the organisation processes of migration and integration
and provide insider migration knowledge, which provides potential migrants with a “streetwise”
edge when embarking on migration. Moreover, skilled migrants typically have greater resources
than other migrants and therefore they can afford visits to the potential destination country prior
to moving (Voigt‐Graf, 2004). Chain migration does continue to play a role in the movements of
skilled and relatively affluent migrants as existing ties can help new migrants with the
application process, or persuade individuals to migrate at a family reunion, for example. The
difference now is that migrants have greater independence compared to decades gone by, due to
better communication channels and access to information from impersonal sources.
Work, Entrepreneurship, and Mobility
Networks also connect individuals who share similar passions. Also called “communities
of interest” (Barnett, 2011) or “passionate affinity groups” (Gee & Hayes, 2010), these passion-
based networks facilitate interactions with other passionate actors, access to resources,
interactive learning, the sharing of values, emotions, and experiences, and the emergence of
novel cultural-social activities, which may be considered vital for entrepreneurs and businesses

33
(Guercini & Cova, 2018; Guercini & Ceccarelli, 2020). Members of such networks consider their
involvement part of their lifestyle and migrant entrepreneurs build and utilise these networks to
expand the scale and effectiveness of their business.
Tolciu (2011) affirms that migrant entrepreneurs are economic actors. Migration
decisions are often dictated by economic conditions and individual career aspirations - such as to
fulfil entrepreneurial career goals and dreams - and socio-cultural determinants (Vissak &
Zhang, 2014; Selmer et al., 2018). The terminology, “migrant entrepreneurs”, is typically used to
describe minority groups, of low economic status, who become entrepreneurs to escape
unemployment and low-paid jobs in a receiving country (Baycan-Levent & Nijkamp, 2009;
Hillmann, 2009; Kloosterman, 2010). More recently, scholars have studied privileged migrant
entrepreneurs and sought to understand the connection between passion, entrepreneurship, and
location (Guercini & Cova, 2018; Guercini & Ceccarelli, 2020). Passion aids the development
and accumulation of skills necessary for long-term success, triggers entrepreneurship, and can
drive lifestyle migration. These more industrious migrants seek places with appropriate
government regulations, access to social capital, and suitable market conditions which contribute
to the potential success of a business (Guercini & Ceccarelli, 2020). Such ‘unconventional’
entrepreneurs may be defined by their use of fan “tribe” or community networks whose members
share an identical passion to the entrepreneur and help the development of the business via
exchanges of ideas, experiences, and creations in conjunction with the entrepreneur (Guercini &
Cova, 2018). Such interactions may lead to cross-national developments, processes, and
innovations (Barnard & Pendock, 2013). Nick Woodman, who invented the GoPro, for example,
conceptualised his camera idea on a surfing trip and further developed it on his return home. His
friends (i.e. fans or tribe members) who shared his passion for surfing, encouraged him to start

34
the business, helped test and improve prototypes, and were thus his early adopters once the
product launched (Guercini & Cova, 2018).
Lifestyle mobility and digital nomadism
Migrant entrepreneurs and migrant workers represent the changing patterns of mobility in
the post-industrial age, as the boundaries between work and leisure are blurring (du Gay, 1996;
McDowell, 1997; Bianchi, 2000). More individuals are relocating to peripheral tourist
destinations for a casual lifestyle supplanted by work (Bianchi, 2000). Career is never a defining
feature of this mobility as migrants can be driven by dual motivations of both leisure and work
(Adler & Adler, 1999; Bianchi, 2000; S. A. Cohen et al., 2015). While some individuals in this
category might be engaging in lifestyle migration, others may be engaging in lifestyle mobility.
The former is typically a one-off transition, whereas the latter is often more multi-transitional,
fluid, and transient. Migrants reterritorialise space or stay in their new location where their new
space is mediated via a property regime or a state apparatus, for example. Comparatively,
nomads are not migrants, as Deleuze and Guattari (2004) assert, as their relation to earth is
deterritorialised, which in turn means that the “nomad reterritorialises on deterritorialisation
itself” and so earth provides a territory for them (p. 421). Digital nomadism is a phenomenon
situated within lifestyle mobilities.
Digitisation and the coronavirus pandemic together have been a catalyst for the change in
mindset of businesses to allow for increased workplace flexibility and autonomy so that
employees can challenge the traditional “9-5” model and pursue a location independent career
(Demaj et al., 2021). Empowered by internet-connected smart devices, laptops, and tablets, and
other technological innovations and platforms, these nomads can work from anywhere with a
data-enabled or WiFi connected device, in cafes or co-working spaces, for example. John

35
Moravec (2013) observes that “whereas industrialisation required people to settle in one place to
perform a very specific role or function, the jobs associated with knowledge and information
workers have become much less specific concerning task and place” (p. 18). He describes these
individuals as nomadic knowledge workers who are “creative, imaginative, and innovative”, and
can “work with almost anybody, anytime, and anywhere” and “instantly reconfigure and
recontextualise their work environments” (p. 18). Many spend two- or three-days undertaking
place-making rituals to adapt to their new location as they must find satisfactory places to sleep,
eat, buy food, and work (Cook, 2020). A term first used by Makimoto and Manners (1997), the
digital nomad often selects their identity based around leisure (e.g. surfing or mountain climbing)
rather than employment (Thompson, 2019). Leisure allows individuals to “suspend for the time
being the weight of the world, to be irresponsible and delight in it, the way that children do when
they play” (Blackshaw, 2010, p. 148). For nomads, it is the primary consideration for location
selection and it is prioritised over employment-based location (Müller, 2016; Thompson, 2019).
As Orel (2019) reveals in his research on the influence of the digital nomad lifestyle on the
work-leisure balance in co-working spaces, the nomad lifestyle assists mobile workers in
balancing leisure with their work tasks. However, finding time for leisure can be demanding and
it may be burdensome to separate work and leisure in tourist locations (Cook, 2020).
Nomads often form “neo tribes” or “postmodern tribes” that comprise members who
share lifestyles and leisure interests (Maffesoli, 1996). These communities of leisure form
networks and members hope that “in a network there will always be some mobile phone numbers
available for sending and receiving messages of loyalty” (Bauman, 2013, p. 70). Many nomads
lean on peers to facilitate lifestyle-related identity construction and to reinforce its legitimacy
and community, especially as these individuals report a conflict between their lifestyle and the

36
perceptions of loved ones who often view their lifestyle as unimaginable, impossible, and/or
irresponsible (Thompson, 2019). However, these peer networks are only “sometimes enduring”
and “often easily dissoluble” (Lash, 2001, p. 27). Nomads are also often segregated from the
local population and cultural contexts, as they tend to seek a community with a similar
demographic profile and lifestyle to themselves. This is especially the case if they seek
constructed community in co-working or co-living spaces, where “their privilege extends to an
insulated bubble-like existence transporting a comfortable, middle-class, Western environment,
to any location” around the globe (Thompson, 2019, p. 28). Jacques Attali (1991) predicted that
this future would transpire around the new millennium. He asserted,
“Severed from any national allegiance or family ties by microchip-based gadgets that will
enable individuals to carry out for themselves many of the functions of health, education,
and security, the consumer-citizens of the world’s privileged regions will become ‘rich
nomads’. Able to participate in the liberal market culture of political and economic
choice, they will roam the planet seeking ways to enjoy their free time, shopping for
information, sensations, and goods only they can afford, while yearning for human
fellowship, and the certitudes of home and community that no longer exist because their
functions have become obsolete” (p. 5).
The lifestyle represents total personal freedom and autonomy, and embodies an
economics of fulfilment ideology, whereby individuals can live unbounded by economic [and
geographic] constraints in a system of hyper-individuality, hyper-opportunity, and hyper-free-
enterprise (Bedogne, 2010). Although most nomads live only temporarily in a new location,
others relocate and then decide to reside there on a [semi] permanent basis.

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Tax-Induced Migration
Much of the literature reveals that the overall proclivity to migrate in reaction to tax
changes is low; however, a handful of contributions researching the impact of tax policy on
forms of privileged migration suggest otherwise. Several studies find that high earners, the key
drivers of economic growth, are likely to respond to tax advantages abroad. Akcigit, Baslandze,
and Stantcheva (2016) provide evidence to suggest that foreign ‘superstar’ inventors tend to take
advantage of tax differentials abroad if they work for a multinational company that does not have
research concentrated in any given country. Additionally, Kleven et al.’s (2014) research into a
Danish preferential tax scheme for high-earning migrants demonstrates that such a tax change
leads to an increase in highly-paid foreigners in Denmark. Fifteen percent of self-made
billionaires, mainly entrepreneurs, migrate abroad and seven in ten migrants from this group
move to low-tax jurisdictions (Sanandaji, 2014). Tax havens such as Switzerland, which is home
to the second-highest number of foreign-born billionaire residents in the world, attract wealthy
migrants such as Sebastian Vettel and Klaus-Michael Kuehne. However, as the literature
suggests, tax rates have no significant impact on migration decisions. Research on tax-induced
migration in Switzerland has revealed that other factors such as the housing market, and not tax
incentives, mainly influence movement, and individuals such as Michael Schumacher, who were
driven by tax considerations, are the exception (Liebig & Sousa-Poza, 2006). A handful of
studies examine the link between high taxes and out migration. Research into the impact of an
introduced millionaire tax on migration in New Jersey highlights that wealthy people of
retirement age, wealthy people living on investment income rather than wages, and extremely
wealthy business owners (top 0.1 percent) are more likely to migrate in response to high taxes
compared to the general population (Young & Varner, 2011). Similarly, Moretti and Wilson

38
(2017) demonstrate that, although the effect is smaller in the year after a tax change, state tax
increases affect the mobility and geographical location of star scientists and other highly skilled
workers increasingly over time.
Small countries have small tax bases compared to the global economy and tend to benefit
the most from giving preferential tax schemes to foreigners. (Kanbur & Keen, 1993; Kleven et
al., 2014). These small countries retain lower aggregate profits from real activities, but they are
not necessarily smaller in terms of geography or population size (Keen & Konrad, 2013). All
countries must consider the loss of revenue from their own capital versus the benefits of
attracting more inward investment; “and for a small country, with a narrow domestic capital base
and a lot of capital abroad that it might attract, the attractions of a rate cut will be greater” (Keen
& Konrad, 2013, p. 274). Advantageous tax incentives, such as Act 20/Act 22 or Act 60 on the
small island of Puerto Rico (see Chapter 3), empower comparatively wealthy individuals to
“choose their countries of residence based on economic incentives, regulatory freedom, and
value opportunities, rather than on cultural or political ties” (Bonilla, 2020, p. 7).
Recently, the influence and popularity of cryptocurrencies and blockchain-based
applications has helped produce a new wave of millionaires (and a handful of billionaires),
whose fortunes have been built from early investment and smart trading. Young (2017) reveals
that the most mobile individuals are young, single, and well educated. However, by the time they
advance in their careers and move into higher tax brackets, their likelihood of migrating
dramatically decreases as family life and existing professional and social networks anchor them.
The world’s richest people are typically older, less flexible, and generally unwilling to be
uprooted. They “rarely move their residency to low-tax countries” and instead, move their assets
offshore and usually live where they were born or “where they started their careers” (pp. 51-54).

39
Comparatively, blockchain migrants are mobile because they are mostly young and wealthy.
They are predominantly tech-savvy, risk-taking young men and between 18-35 years old
(Coinberry, 2018; eToro, 2018), who establish residence in tax havens to protect their wealth.
Migration to low-tax jurisdictions is not surprising given the libertarian ideology of many
crypto/blockchain enthusiasts who believe in the promise of technology as an enabler for
humanity to break away from state control and interference in their lives (Huckle & White, 2016;
Karlstrøm, 2014; Maurer et al., 2013). Nakamoto, the anonymous creator of bitcoin, stated in his
early writings to the late Hal Finney that the technology was “very attractive to the libertarian
viewpoint, if we can explain it properly” (Nakamoto, 2008). Thus, a concentrated pool of
blockchain entrepreneurial, innovative, highly skilled, educated, and motivated individuals reside
in low-tax crypto hubs that have emerged in Malta, Singapore, Bermuda, Puerto Rico, ‘Crypto
Valley’ in Switzerland, and elsewhere, where it is legal for investors to not pay taxes on some
(e.g. on long-held cryptocurrency), or all, cryptocurrency gains. Due to their crypto-friendly tax
policies, these countries offer significant opportunities for entrepreneurs and investors.
Colonialism and Colonial Entrepreneurship
Entrepreneurs are lured to places such as Vanuatu - a former Anglo–French colony and
the first country to sell passports for bitcoin - and other similar regions ripe for blockchain
migration and entrepreneurship, by tax breaks and the desire to accomplish social or
humanitarian goals (Jutel, 2021). Whereas colonialism is the power and control of one people
over another via subjugation, which usually involves the transfer of population to the colony
where they live as permanent settlers and retain political allegiance to the country of origin,
imperialism is the exercise of power of one country over weaker nations via settlement,
sovereignty, or indirect mechanisms of control. The term neo-colonialism arose after World War

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II to describe the last phase of imperialism following the collapse of the old colonial system.
Under neo-colonialism, “the State which is subject to it is, in theory, independent and has all the
outward trappings of international sovereignty. In reality its economic system and thus its
political policy is directed from outside” (Nkrumah, 1974, p. ix). The history of U.S.-Puerto Rico
relations and the historical context of colonialism on the island is discussed at length in Chapter
3. Puerto Rico is not a neo-colony as it has not been decolonised to become an independent state
or a state in the United States. Therefore, predictably, Americans from the mainland who have
relocated to Puerto Rico, are often labelled colonisers by the local Puerto Rican population.
Aponte and De La Torre (2020) described Puerto Rico as “a colony in a postcolonial
world” (p. 180), as it is owned by but not technically part of the United States. The United
Nations paid considerable attention to decolonisation, in its “Special Committee on the Situation,
regarding the Implementation of the Declaration on the Granting of Independence to Colonial
Countries and Peoples” that was created in 1961 and helped more than 80 former colonies gain
independence. Many non-self-governing territories achieved ‘self-determination’ since the late
1940s, but few scholars have focused on privileged migrants or ‘colonial’ entrepreneurs in these
locales. The literature is thin on ‘colonial’ entrepreneurs – especially since only 17 non-self-
governing territories remain under the purview of this UN committee (United Nations, 2018).
Existing literature tends to focus on colonial situations from more than a century ago (Perkins,
1989; Emmer, 2012; Kjerland & Bertelsen, 2014). This research highlights how entrepreneurial
colonial populations are “active participants in an economic, social, and political system”
(Perkins, 1989; Kjerland & Bertelsen, 2014) and demonstrates that many colonial entrepreneurs
do not settle permanently; instead they concentrate on extracting and transferring monetary and
other resources from the colony to the coloniser (Kjerland & Bertelsen, 2014). Indeed, India

41
fuelled the British Empire for a century. Given the huge influence the United States had during
the 1960s, Puerto Rico was never placed on the UN’s non-self-governing territory list (Muñiz,
1976). According to the U.S. imperial logic, Puerto Rico is “foreign in a domestic sense”
(Burnett & Marshall, 2001).
Many investors and entrepreneurs are drawn to projects relating to sustainable
development, protecting the global commons, and improving people’s lives (Howson, 2020).
The usual assumption is that there are great rewards as entrepreneurial profit for being early in
uncharted geographies (Li, 2007, 2014). Hence, entrepreneurial activity is greater in emerging
markets than developed economies (Estrin et al., 2018). These are depopulated locations situated
outside of history, which are simultaneously emptied and full, where inhabitants and their
imaginaries are not considered and the landscape is defined in terms of its natural resource
endowment (Bridge, 2001). However, when evaluating the plausibility of land and resources for
development promoters are required to “overlook the presence of people who remember long
histories of recurrent dispossession and neo-colonial imposition” (Howson, 2020, p. 2).
As emerging markets and developing countries can be used as regulatory sandboxes,
some blockchain professionals view them as suitable locations to experiment with alternative
systems (Ninai, 2017). Jutel (2021) probes “blockchain imperialism” in the Pacific and examines
how the developing world is used as a testing ground by entrepreneurs experimenting with
blockchain governance solutions that bypass state control, which is often considered a corrupting
intermediary. Such projects are deemed extractive as they impose blockchain and big data
rationalities onto the developing world, exclude local subjects, and open regions to supply chain
control, market control, and digital identity and agency transformation, which Jutel (2021)
argues comprise “blockchain cartographies of control”. Similarly, Howson (2020) demonstrates

42
how climate crises are used to justify “crypto-colonialism,” whereby blockchain technology is
used to extract economic benefits - including land, labour, data and other resources - from the
Global South. These endeavours are led by outside interests and focus on technology as a starting
point in order to advance capitalist forms of governance while oftentimes ignoring the wants and
needs of the local community. In addition, Crandall (2019) observes that blockchain technology
is enhancing and reinforcing existing power structures in Puerto Rico through technocratic
means, and it is unlikely that the island’s marginalised population will have their voices heard
regarding their future in relation to blockchain, especially as they have been treated as
“disposable second-class citizens” (p. 282).
Techno-Utopianism
Globally influenced techno-utopianism and the belief in the emancipatory potential of
technology stems from the logic of Silicon Valley cyberculture and its articulation of the
Californian Ideology (Barbrook & Cameron, 2001). New technologies and utopian ponderings
go hand in hand. These discourses are filled with promises of liberty, progress, and economic
benefits and the hope that people are finally able to live “the good life” (Tresch, 2012). They
appear throughout history in tandem with the introduction of novel innovations to society,
including the invention of the printing press (Eisenstein, 1980) and radio (Craig, 2008). General-
purpose technologies, such as the internet or blockchain technology underscore the pervasiveness
of this ideology. In his cultural history of Silicon Valley, Turner (2006) describes the group of
individuals who led the countercultural movement in the late 1960s as the New Left and New
Communalists, the latter of which turned “toward technology and the transformation of
consciousness as the primary sources of social change” (p. 4). At this time, Silicon Valley
witnessed the emergence of both the hippie movement and computing industries. Whereas some

43
hippies passionately rejected technological progress due to it being perceived as representing a
“false god” and being emblematic of “a malevolent and ubiquitous technological bureaucracy”
(Barbrook & Cameron, 2001, p. 366; F. Turner, 2005, p. 488), others believed that such progress
would facilitate the manifestation of their libertarian ideals in reality (Barbrook and Cameron,
2001). Turner’s (2006) account charts the detailed ways the countercultural movement
understood the potential of new technologies, especially through utilising Stewart Brand’s Whole
Earth Catalog (later the Whole Earth Network) for learning about tools and technologies for
heading back to the land in the realms of scientific research, hippie homesteading, ecology, and
mainstream consumer culture. Mainstream culture was seen as a prison that conditioned people
into conformity. The 1984 Apple Macintosh Superbowl commercial epitomised this perspective
by showcasing good versus evil: the authoritarian bad technology “which crushes the human
spirit and controls people’s minds” or the liberating good technology, which is independent and
individualised (Friedman, 2005, p. 111). The advertisement underscored the countercultural ideal
in that the high-tech future could be utopian if technologies were built with “a human face”
(Schumacher, 1973) – i.e. created with social harmony in mind. Indeed, Apple co-founder Steve
Jobs, a child of the counterculture, described the Whole Earth Catalog as “one of the bibles of
[his] generation” (Deighton, 2017). Together, the consumers and creators of Brand’s magazine
developed a vision of technology that opposed mainstream ideals and shaped public perceptions
of computing and other associated technologies for decades to come. Their deep-seated ideology,
which still permeates the start-up economy today, highlighted the ways new technologies are
often romanticised for their ability to improve human life. Indeed, Wired, a publication focused
on cutting-edge technology and digital trends, which Brand founded in 1993, often featured
individuals from the Cypherpunk movement who were pessimistic about the “intrusive nature of

44
government and corporations” (Coleman & Golub, 2008, p. 260) and unified in the belief that
freedom should largely be attained through the use of cryptography online.
Globalisation and Inequality
While techno-utopian imaginings certainly made their way into the tech industry, the
information age also redefined freedom, (in)equality, and free market entrepreneurialism.
Technological advances enable, shape, and sustain globalisation processes (Castells, 2010).
Shared forms of social coordination enables activities to be organised on a global scale and
global cultures to emerge (Grewal, 2008). The expansion of networks and increases in
interconnectivity have facilitated globalisation, and this combined with the capitalist pursuit of
profit have heightened socioeconomic inequalities (Sassen, 2013). Milanovic (2016) argues the
second technological revolution is characterised by transformations in information technology,
globalisation, and the rise of diverse occupations in the service sector. Increasing wages enable
labour to be replaced with capital and thus wages have become unequally distributed; high-
skilled labour has become more expensive and low-skilled jobs have been replaced with
technology (Milanovic, 2016). Dominant interests and individuals with [an abundance of] social
capital occupy global spaces and are therefore plugged into the global network, whereas those
without appropriate value to offer the network tend to be excluded, “so inducing a geography of
social, economic, and technological inequality” (Castells, 2010, p. xviii). The growth and
influence of modern technology have been central to the progress towards new global realities.
The enhanced mobility and division of labour and capital, the outsourcing of production, and the
globalisation of financial markets across international boundaries has reconfigured global
economic and social power structures (Tonkiss, 2006).

45
Chapter Conclusion
The literature illustrates the complexity and multidimensionality of the linkages between
migration, mobility, networks, colonialism, and ideology. Unlike typical migration studies
research, which generally portrays the migrant as a victim lacking agency and focuses on labour,
capital, and employment, research on privileged migrants tends to concentrate on the central
roles of agency and power in relation to leisure time and consumption. This review has
highlighted how migrants express relative (not absolute) privilege through material and symbolic
resources (see, for example, Croucher, 2009) and how economic power differentials between
sending and receiving countries determine to what extent migrants can live in relative luxury
(see, for example, von Koppenfels, 2014). The lived experience of expatriates (or lifestyle
migrants) exposes structural and systemic inequalities and inequitable power dynamics in, for
example, economic opportunity and housing. Migrant entrepreneurship in receiving countries
makes visible capital flows and the unbalanced distribution of benefits and resources, in the form
of tax advantages and social capital, can spawn innovation and other developments (see, for
example, Guercini & Ceccarelli, 2020). Such practices highlight structural forms and
asymmetrical relationships of domination and exploitation of local populations, which are
emblematic of arrangements in both present- and post-colonial regimes.
Akin to Benson and O’Reilly’s (2018) research on privileged migration as stories of
practice in Malaysia and Panama, this work focuses on narratives of migration (and
entrepreneurship) that intersect with contemporary economic structures, processes, and social
forces that provide the context in which migrants live. The present- and post-colonial contexts
within which these migrations occur are continually enacted and produced by migrants on the
ground. The Puerto Rican case illuminates these structures and dispositions that shape and

46
facilitate blockchain-related lifestyle migration, as these expatriates are the latest consequence of
Puerto Rico’s colonial relationship with the United States. This study departs from previous
blockchain-related migration research (Crandall, 2019; Howson, 2020; Jutel, 2021) that
primarily focuses on settler colonialism, computational capitalism, and sustainable development.
Rather, it concentrates on the lived experiences, attitudes, values, and behaviours of migrants in
the realm of migration stories, technology diffusion, and social and material transformations.
This shift in focus provides a different perspective to the multi-level analysis and evaluation of
privileged migrants in locales attractive to blockchain founders, investors, advisors, and
enthusiasts. By deviating from the macro factors that constitute the basis for most blockchain-
related migration research, this study highlights the micro and meso fundamentals of the
migrants’ lived experiences in Puerto Rico.
Chapter 3 revisits some of the topics in the present chapter to explore the wider structural
conditions and the context within which blockchain-related migration has occurred in Puerto
Rico.

47
Chapter 3 The Puerto Rican Context
This chapter probes the structural and material conditions that might explain why Puerto
Rico has recently received an influx of migrants involved in the blockchain technology and
cryptocurrency ecosystem. Beyond spurring economic growth, these lifestyle and entrepreneurial
migrants set the stage for societal and cultural transformation, as they bring new dynamics and
challenges to the practices and developments carried out in local areas. Processes of
globalisation, or the “intensified and increased movement of people, images, ideas, technologies,
and economic and cultural capital across national boundaries” (McCarthy et al., 2003, p. 454),
are accelerated by computerisation and electronic media, and affect places at all scales whether
they’re rural or urban or as small as a home or as large as a nation state. Local and regional
dynamics are increasingly intertwined with global influences - and vice versa - and taken
together expound the emergence of lifestyle migration in particular localities. Thus, push and
pull factors, and broad historical, socio-cultural, geopolitical, and economic contexts within
which migration has occurred, including the consideration of policy and the powerful influence
of the media, must be understood to frame and understand the consequences of such movement.
About Puerto Rico
Geography
Puerto Rico is the smallest and most eastern island of the Greater Antilles in the
Caribbean Sea, which comprises Española (anglicised to ‘Hispaniola’, which is politically
divided into Haiti in the west and the Dominican Republic in the east), the Cayman Islands,
Jamaica, and Puerto Rico. It is approximately 110 miles long by 40 miles wide and is one of the
most densely populated land masses in the region (Mendez-Mendez & Fernandez, 2015; U.S.
Census Bureau, 2018). Puerto Rico is often referred to as an island, but it is an archipelago

48
comprising four significant islands, of which Puerto Rico, Vieques, and Culebra are inhabited,
and Mona is uninhabited.

Figure 3.1. Puerto Rico: Main towns, roads, and rivers (Geology, 2021)
Population
According to the 2020 Census, 3,285,874 people live in Puerto Rico; more than half of
them in major cities, including Mayagüez in the west, Ponce in the South, Caguas in the east, and
San Juan - the island’s capital - which together with Bayamón, Carolina, Cataño, Guaynabo, Toa
Baja, and Trujillo Alto make up the San Juan metropolitan area (área metropolitana de San Juan)
on the north-eastern coast (U.S. Census Bureau, 2020). The majority of Puerto Ricans identify as
white; however, since there are more than twenty racial terms commonly used in Puerto Rico, it
is difficult for Puerto Ricans to classify themselves according to U.S. census categories (Duany,
2017). Spanish and English are the co-official languages, but Spanish is the dominant language
of Puerto Rico; although all the official business of the U.S. District Court is conducted in

49
English (ostensibly to facilitate the appeals process in the First Court of Appeals in Boston)
(Pousada, 2018).
Climate and natural disasters
The island enjoys a tropical climate, with average temperatures about 79°F (26°C)
annually (Lopez & Gritzner, 2006). The wet season is from June to October and the dry season
runs between November and May (Pitzer, 2009). Hurricane season occurs between mid-June and
mid-November. The last major hurricane to hit the island was Hurricane Maria in September
2017, a category 5, which caused severe infrastructural damage, thousands of deaths (although,
the Puerto Rican government significantly downplayed the death toll), and significant population
displacement, with many Puerto Ricans relocating to the mainland. It damaged roads, disrupted
access to medical care, and interrupted communications networks and access to electricity and
clean water (Kishore et al., 2018). It also caused $90 billion in damage to property and
infrastructure and compounded the destruction caused by Hurricane Irma, which had passed
north of the island two weeks earlier (Kishore et al., 2018). Earthquakes are a further hazard for
Puerto Rico, due to its location at the edge of the Caribbean tectonic plate and the North
American plate. Significant earthquakes struck the island from 28 December 2019 and continued
into 2020. On 7 January 2020, Guanica on the south of the island, was hit by a 6.4 magnitude
quake, followed by a series of aftershocks including a 5.9 magnitude quake four days later. Many
people were left without power for almost a week in the San Juan metropolitan area following
the 6.4 quake and thousands of people in the south were forced to live outside in tents for several
months, as their homes were deemed unsafe (Robles, 2020).

50
Political status
The relationship between Puerto Rico and the United States is anchored in the territories
clause of the U.S. Constitution (Article IV, Section 3, clause. 2). Since Puerto Rico attained
commonwealth status on 25 July 1952 (which meant that it was removed from the United
Nations’ list of “non-self-governing territories” - i.e. colonies), the island became almost
completely self-governing. It elects its own governor and other officials; although, its head of
state is the president of the United States and foreign relations and national defence matters are
conducted by the U.S. federal government. Puerto Ricans are subject to U.S. federal law. They
may vote in U.S. primary elections but are not eligible to vote in U.S. presidential elections. The
governor of Puerto Rico is elected for a four-year term and may be re-elected indefinitely. The
governor has the authority to appoint judges and agency heads. The Legislature comprises a
Senate of at least 27 members (two from each of the eight senatorial districts and 11 elected at
large), and House of Representatives of at least 51 members (one from each of the 40
representative districts, and 11 elected at large). The judicial branch comprises the Supreme
Court and other courts, and the governor appoints judges with the approval of the Senate (Bea &
Garrett, 2010). The judicial branch upholds the Constitution of the Commonwealth of Puerto
Rico. Despite its self-governing status, the balance of political power and control over the island
is swayed towards Washington.
Tourism
The modern tourism industry began to emerge in 1919 when the Gran Hotel Condado
Vanderbilt opened in San Juan (but prohibition limited tourism initially). The growth in the
number of leisure visitors accelerated after 1949 when commercial air travel between New York
and San Juan became affordable (J. Morales, 1986). During this time, the Puerto Rican

51
government, supported by the Puerto Rico Industrial Development Company (PRIDCO) and the
Puerto Rico Government Bank via Operation Bootstrap (Operación Manos a la Obra), a
modernisation and industrialisation programme, financed and built the luxurious Caribe Hilton
hotel for $7,000,000 (Torres Santiago, 2000; The Caribe Hilton, 1950). Havana was the hub for
American visitors until the Cuban Revolution closed the country to U.S. tourists in 1959. Puerto
Rico was a major beneficiary and grew in popularity as a destination for mainland visitors (J.
Morales, 1986). By the late 1950s, annual tourist figures had reached about 250,000. This
number doubled by the mid-1960s, when Puerto Rico became the Caribbean’s most visited
island (Merrill, 2001). Puerto Rico welcomed more than four million visitors during 2019, a 62.3
percent increase in tourist arrivals since Hurricane Maria. Between March and May 2020,
100,000 jobs were lost, and more than 25 percent of the workforce in the tourism sector became
permanently unemployed because of COVID-19 (Gardehl, 2020). Prior to the Coronavirus
outbreak in early 2020, tourism accounted for 6.5 percent of the island’s GDP and the industry
employed nearly 80,000 workers (Ward, 2020).
History of Puerto Rico
Puerto Rico has a contentious history of colonial rule. Following colonisation by the
Spanish, and the eradication of the indigenous Taíno population, the island suffered numerous
attacks from European nations due to its strategic importance as an entrance to the Caribbean
Sea. The island was finally taken by the American military on 18 October 1898 during the
Spanish-American War and, in 1917, Puerto Rican residents were granted U.S. citizenship,
which then facilitated migration between the island and the mainland. Puerto Rico gradually
became Americanised through the public education system and the influx of U.S. capital,
technology, laws, and customs. Migrant entrepreneurs first arrived in Puerto Rico from Cuba in

52
the 1960s, after Fidel Castro came to power and skilled Dominicans followed in the 1970s and
1980s. Soon after, many working-class Dominicans arrived illegally, pushed out by the
Dominican Republic’s economic crisis.
The history that underpins Puerto Rican immigration goes back to when the Spanish
arrived in the Americas to look for gold and spread Catholicism (Merced, 2010). Christopher
Columbus landed in Puerto Rico on 19 November 1493 and named the island, Isla de San Juan
Bautista (Saint John the Baptist) in honour of the son of the Catholic King and Queen of Spain,
Prince Don Juan (Canino & Canino, 1993). Before the arrival of Columbus and his Spanish
caravels, on their second voyage to the “New World”, the Taíno Indians had lived in Borinquén -
now Puerto Rico - for about five centuries (Wishart, 1985). They lived in large villages each
governed by a chief (cacique). Multiple families lived in houses made of wood and thatch
situated around a central plaza. The chief’s home, located on the plaza, was typically larger and
fancier than the rest (Rouse, 1992). Crops - including cassava (casaba) sweet potato (batata),
corn (maiz), squash, beans, peppers, peanuts, fruits, calabashes, cotton, and tobacco (tabaco) -
were grown by piling mounds of earth in permanent fields called conuco, which aided harvesting
and weeding, a superior method compared to the more common slash and burn technique usually
employed in the tropics (Rouse, 1992). Shamans (behiques, buhuitihus, boitii) served as
intermediaries between the physical and spirit world and cured the sick in rituals and ceremonies
that involved the ingestion of snuff (cohoba) and herbs (gioia) (Rouse, 1992). The Taíno people
worshiped deities and idols, and fetishes representing them, known as zemis. The supreme zemis
were: Yúcahu, the lord of cassava and the sea; and his mother, Atabey, the goddess of fresh
water and human fertility, and the lesser zemis included the spirits of ancestors and other spirits
who lived in the natural landscape (Rouse, 1992). Zemis were used in ecstatic trances, séances,

53
and curing ceremonies performed by shamans and principal men (hombres principales) or chiefs
(caciques) (Siegel, 1999). The Taínos numbered about 100,000 in Borinquén in 1493 and they
were the first indigenous inhabitants of the Americas to encounter Europeans (Duany, 2017).
Juan Ponce de León: From occupation to unyielding colonisation
Following Columbus’ death in 1506, Juan Ponce de León, a Spanish conquistador who
travelled with Columbus in 1493, was asked by the Spanish Crown to lead the colonisation of
Borinquén. The island was selected because of its gold mining potential, and in 1508 Ponce de
León founded Caparra, the earliest Spanish settlement on Puerto Rico’s north coast (S. Turner,
2013). He ruthlessly exploited the Taíno workers, many of whom died as a result of the poor
conditions in the mines (Olson, 1991). In 1511, Caparra’s name was changed to Ciudad de
Puerto Rico (City of Rich Port), due to its location and abundance of natural resources, and in
1521, the city was relocated across the bay to take advantage of superior soil and vegetation,
defensive potential, and better access to the harbour (Duany, 2017). Ultimately, the names of the
capital city and island switched, possibly through cartographic error, whereby the island became
known as Puerto Rico and the capital city, San Juan (Rough Guides & Agate, 2002).
In 1510, the Spanish Crown officially appointed Ponce de León as Puerto Rico’s first
Spanish governor (Duany, 2017). His rule ended a year later when Don Diego Colon, eldest son
and heir of Christopher Columbus, claimed jurisdiction over Puerto Rico on the basis of the
Crown’s contract with Columbus, which affirmed Columbus’ right to appoint governors of the
Indies islands (Peck, 1992). Ponce de León left Puerto Rico and went on to discover and name
Florida in 1513, as the first European to land there. He returned to colonise Florida in 1521 but
lost an important skirmish with the indigenous Calusa tribe, where a poisoned arrow struck
Ponce de León in his thigh. His expedition swiftly departed to a new settlement in Cuba (Duany,

54
2017; S. Turner, 2013). This new settlement soon became Havana, and it is where Ponce de León
died in 1521. His remains were later brought to San Juan, Puerto Rico where they now rest under
the cathedral of San José (S. Turner, 2013). Puerto Rico’s fourth largest city, Ponce, is named
after Juan Ponce de Leon y Loayza, the great grandson of Ponce de León.
The replacement of Taíno slave labour in the plantation system
The Taíno people initially welcomed the Spaniards, but they were soon enslaved by the
Spanish colonialists who forced them to work long hours in the goldfields or on ranches. Under a
regime known as the encomienda (estate) system, the Taínos spent at least half the year working,
and were allowed to return to their villages for the remainder of the year (Rouse, 1992). The
Taíno population declined rapidly due to malnourishment and unsanitary working and living
conditions, suicide by hanging, and cassava juice poisoning (Rouse, 1992). In 1514, a census
recorded only 22,726 Taíno people able to work (Rouse, 1992).
To compensate for the dwindling Taíno population, African slaves were imported to
work on the island; the Spanish Crown granted permission to introduce slaves to the Americas in
1501. In addition, Indian slaves were imported from other parts of the Caribbean and assigned to
the encomiendas (Duany, 2017). Slaves tended to settle in towns close to the main sugar
plantations on the island in Ponce, Mayagüez, and Guayama, and worked as farm labourers,
domestic workers, gold miners, and builders of forts and churches (Duany, 2017). By 1524, there
were more slaves on the island from other parts of the world than Taínos. By 1540, the Taíno
population had been further depleted - through out-migration to other territories, violent clashes
with Spanish soldiers, imported contagious diseases from Europe, malnutrition due to crop
destruction from war and hurricanes, intermarriage, and suicide - and almost completely replaced
by slaves and Spanish colonists (Anderson-Córdova, 1990; Duany, 2017; Rouse, 1992).

55
Between 1509 and 1860, as many as 75,000 slaves were introduced to Puerto Rico and by
1846, slaves accounted for 11.6 percent (51,265) of the island’s population (Duany, 2017). An
inconsistent quirk in the law from 1750 meant that slaves fleeing other countries were allowed to
enter Puerto Rico as free men and women (Canino & Canino, 1993). Following uprisings against
Spanish rule in 1868, the Moret law was passed by the Minister of Overseas Colonies,
Segismundo Moret Y Prendergast, which secured gradual slave emancipation for Puerto Rico
(Morgan, 2016). Although the number of slaves was naturally declining due to their growing
cost, slave owners received 200 pesos per freed slave in compensation from the Spanish treasury
(Morgan, 2016). In 1873, when less than 2 percent (29,335) of Puerto Rico’s population were
slaves, slavery was finally abolished by the new Spanish Republican government (Duany, 2017).
Defending Puerto Rico from European attacks
San Juan harbour was one of the main entrances to the Caribbean Sea. It was deemed so
strategically important that King Phillip II of Spain called it “the key to the Indies” (Duany,
2017). Rumours of a French attack in the 1520s prompted San Juan settlers to build a wooden
bulwark at the port entrance, and in 1521 Casa Blanca, the governor’s residence, was built and
used as a refuge in case of attack (O. J. de Wagenheim, 1998). Between 1532 and 1540, the
Santa Catalina fortress (now the Governor’s official residence, La Fortaleza) was built on the
southwest quadrant of the city; it was San Juan’s first defensive fort. Castillo San Felipe del
Morro - “El Morro” (“morro” meaning promontory or headland) - was built between 1539 and
1540 in honour of King Philip II of Spain at the rocky entrance to the bay on the north west of
the city (O. J. de Wagenheim, 1998). Both forts offered harbour defences from enemy war ships
entering San Juan Bay and were staffed by Spanish soldiers.

56
In 1598, the British, led by George Clifford, the Earl of Cumberland, attacked San Juan,
and encountered little resistance. Rather than sailing through the bay, as other invading forces
had done previously, Cumberland and his men entered the city over land. On 18 June, they
marched into the city and found it nearly deserted, aside from a few hundred Spaniards in the
Morro fort (O. J. de Wagenheim, 1998). El Morro and Fortaleza were surrendered, and the
Spanish soldiers were shipped to Jamaica. British rule only lasted until 5 September that year
because, weakened by hunger and disease, Cumberland’s forces were unable to defend
themselves from attacks by settlers outside of San Juan. Reinforcements from Spain soon arrived
to retake the island. Although relations between the British and Spain improved after the death of
Queen Elizabeth in 1603, the Spaniards remained suspicious of England’s intentions and so
continued to repair and improve Puerto Rico’s defences (O. J. de Wagenheim, 1998).
On 24 September 1625, the Dutch, led by General Bowdewijn Hendriksz, invaded San
Juan. Governor Juan De Haro believed that Hendriksz would land his troops at the Escambrón
beach, as Cumberland had done, and therefore he deployed his soldiers to the area (O. J. de
Wagenheim, 1998). However, Hendriksz sailed straight into the harbour and was able to bypass
El Morro as its weaponry was in disrepair and troops were repositioned outside the city (Flores,
2009). Hendriksz threatened to set fire to the city, but the governor refused to surrender, and the
Dutch failed to defeat the Spaniards. Hendriksz retreated and returned to the Netherlands on 2
November (O. J. de Wagenheim, 1998).
The attacks demonstrated how vulnerable Puerto Rico’s defences were. Work on the
Castillo de San Cristóbal fortress (Fort St. Christopher) began in 1634. The fortress was built as a
defence against attacks from the Atlantic Ocean and land invasions (Manucy & Torres-Reyes,
1973; Pabon-Charneco, 2016). Following its construction, which continued for a century, San

57
Juan was surrounded and protected by walls and forts. Its only entrances were via the San Juan
Gate which stopped ships on their way to the port, the San Justo Gate which offered access to the
city from the docks, and the Santiago Gate which provided access to the city from the rest of the
island (Wilson, 1994). The city’s defences held firm in the 1797 Battle of San Juan when 7,000
British soldiers attempted to conquer Puerto Rico during the 1796-1808 Anglo-Spanish War (O.
J. de Wagenheim, 1998). This was England’s last attempt to take Puerto Rico as San Juan
became less strategically important as a defence for the gateway of the Caribbean (Wilson,
1994).
The Wars of Spanish-American Independence (1809-1829) ended Spain’s status as a
world power. While the Spanish were preoccupied with the French, the Spanish provinces
rebelled and declared the Spanish colonies to be fundamental parts of Spain. After that, civil
rights in Puerto Rico were frequently withdrawn and granted in line with power shifts in Europe
and civil unrest in Spain (Malavet, 2007; O. J. de Wagenheim & Wagenheim, 2002). Following
the conflicts, Cuba and Puerto Rico were the only colonies remaining in Spain’s possession.
Mexico (1810), Panama (1821 [though part of Columbia until 1903]), Venezuela (1811),
Ecuador (1820 [though part of Columbia until 1830]), Bolivia (1825), Peru (1821), Columbia
(1810), Argentina (1816), and Chile (1810) all became independent countries (Fletcher, 2014).
Towards independence from Spain
In 1812, the first Spanish Constitution was extended to the island (Monge, 1999). It made
Puerto Rico a Spanish province, with representation in the Spanish Parliament and afforded
Spanish citizenship to all Puerto Ricans. In 1814, the Constitution was repealed, only to be
reinstated in 1820, and repealed again in 1823 (Committee on Interior and Insular Affairs, 1959).
In 1869, the Spanish constitution gave Puerto Ricans greater participation in the Spanish

58
parliament (the Cortes), and allowed political parties on the island; the enabling legislation was
passed in 1873 (Malavet, 2007).
In 1895, Luis Muñoz Rivera, head of the Autonomist Party that favoured the
establishment of an independent Puerto Rico under Spanish colonial rule, elicited a promise from
Práxedes Mateo Sagasta, the head of Spain’s monarchic Liberal Party, to grant autonomy to
Puerto Rico once in power (K. Wagenheim, 1970). True to his word, Prime Minister Práxedes
Mateo Sagasta granted the island limited autonomy through the Charter of Autonomy by signing
a royal decree on November 28 1897 (K. Wagenheim, 1970). The Charter guaranteed self-
government, elected representation via a legislative body in Puerto Rico and Spain, a governor-
general appointed by the Spanish head of state to represent the Spanish monarch, and
proportional representation in the Cortes (Malavet, 2007). In February 1898, the cabinet of the
new autonomous government was appointed, and on 27 March 1898 general elections were held
for legislators (K. Wagenheim, 1970). The island’s first autonomous government was officially
installed on 17 July 1898 (Malavet, 2007).
The American invasion
In April 1898, the Spanish-American War began. Three months later, General Nelson A.
Miles landed at Guánica on the south coast of Puerto Rico with 16,000 American troops (K.
Wagenheim, 1970). There was little resistance. Some Puerto Ricans even provided animals and
transportation for the American troops (Caban, 2018). Many didn’t care for the outrageous prices
of goods and services from the Spanish-owned stores and hoped that the Americans would install
a more liberal and progressive form of democracy on the island (K. Wagenheim, 1970). The
enthusiastic welcome shocked the Spaniards, and the Puerto Rican battle lasted only 17 days;
although, the war lasted 115 days (Caban, 2018; K. Wagenheim, 1970). The U.S. military took

59
formal control of the island on 18 October 1898 and the Spanish flag at El Morro was removed
and replaced with the Stars and Stripes (Wells, 1969). The Treaty of Paris, signed on 10
December 1898, marked the end of the Spanish-American War. Spain ceded control of Puerto
Rico, Guam, and the Philippines to the United States, and granted independence to Cuba (Cuba
was then burdened with the Platt Amendment, which granted territory to the U.S. military, and
prohibited Cuba from making treaties with other nations – effectively providing U.S. control
over Cuba’s foreign affairs) (Perez, 1986).
When the U.S. military initially occupied the island, only 13 percent of the population
was literate, 21,000 out of 300,000 school-age children were in school, 2 percent of the 39,000
farms on the island accounted for 70 percent of the island’s cultivated land, and only 175 miles
of roads were passable when it rained (K. Wagenheim, 1970). Jobs were scarce and many
families lived in thatched huts on one meal a day. Quickly, the United States initiated multiple
reforms intended to Americanise the island’s social and political system (Wells, 1969).
The Americanisation of Puerto Rico
Two years after the United States invaded and conquered Puerto Rico, the Organic Act of
1900 (the Foraker Act) was signed into law. The Foraker Act removed many liberties achieved
by Puerto Ricans during Spain’s 400-year rule (Monge, 1999). It contained no provision for
making Puerto Rican inhabitants citizens of the United States and Puerto Ricans were afforded
no role in designing government as control over insular affairs was retained in Washington rather
than granted to the Puerto Rican electorate (Wells, 1969; Murrin et al., 2008). It also enabled
Puerto Rico to issue bonds to finance its governmental operations. Unlike its Cuban neighbours,
the “unincorporated territory” of Puerto Rico was not offered nominal independence by the
United States; rather, the Foraker Act was essentially an American imperial mechanism to ensure

60
sovereignty over the island by appointing, not offering an election for, high-ranking government
members, including the governor, cabinet, and Supreme Court (Duany, 2017).
During 1900 and 1901, Charles Herbert Allen served as Puerto Rico’s first civilian
governor. He created new agencies staffed by American bureaucrats and used his position to gain
a controlling interest in the entire Puerto Rican economy. He also acquired an international sugar
empire by installing himself as treasurer and then President of the American Sugar Refining
Company when he returned to the mainland in 1901 (Denis, 2015). American economic interests
invested heavily in the Puerto Rican sugar industry, increasing the size and technological
efficiency of production. Compared to exports of 57,000 tons of sugar under Spanish rule during
the previous decade, the island exported 489,000 tons in 1917 and 606,000 tons in 1928 (Wells,
1969). As well as converting 45 percent of all arable land into sugar plantations, by 1930 Allen,
along with U.S. banking interests, owned the entire coastal railroad, the insular postal system,
and the international seaport of San Juan. By 1934, U.S. companies owned 80 percent of the
sugar cane farms on the island (Denis, 2015).
In 1899, following Hurricane San Ciriaco, the largest hurricane in Caribbean history, the
United States outlawed all Puerto Rican currency - which until then held a global value equal to
the U.S. dollar - and set the value of one Puerto Rican peso at 60 U.S. cents (Denis, 2015). The
Puerto Rican peso was gradually replaced with U.S. dollar between 1898 and 1913, with the
Bank of Puerto Rico (previously known as the Banco Español de Puerto Rico) issuing Puerto
Rican “dollars” in the interim. In 1901, eight schools were built that were named after American
heroes, including George Washington and John Adams. American holidays were pronounced
official school holidays, children were required to salute the American flag and cite the U.S.
Pledge of Allegiance, and Spanish history taught in schools was supplanted with the study of

61
American history (Wells, 1969). A year later, the Official Languages Act mandated English as
the only language of instruction in all school classes, even though the majority of Puerto Ricans,
including the teachers, could not speak it (N. Morris, 1995). In the 1980s, the four main Puerto
Rican commercial television stations were gradually put up for sale and sold to U.S. media
conglomerates for exorbitantly high prices that were beyond the reach of local businesses
(Rivero, 2005).
In 1917, the Jones-Shafroth Act, also known as the Organic Act of 1917 or the Jones Act,
effectively eliminated Puerto Rican citizenship and granted U.S. citizenship to the people of the
island, unless they signed a document to refuse it, which in turn deprived them of a number of
civil rights such as an eight hour work day and freedom of speech, press, and religion (K.
Wagenheim, 1970; Duany, 2017). Citizenship allowed eligible Puerto Ricans (male territorial
residents aged 18-45) to serve in the U.S. military and facilitated travel, and indeed migration
between the island and the mainland without visas or passports (Erman, 2018). Unlike their U.S.
counterparts, Puerto Rican residents had no right to trial by jury in line with the Sixth
Amendment of the U.S. Constitution and they were not permitted to have voting delegates in
Congress; however, if Puerto Ricans migrated to the mainland, they could exercise their full
range of constitutional rights as U.S. citizens (Duany, 2017). The Jones Act also allowed the
United States to continue to appoint the governor of Puerto Rico and Congress to continue to
override and pass legislation pertaining to the island; though, Puerto Ricans were now able to
elect a resident commissioner for the island, a role that had previously been appointed by the
U.S. president (Duany, 2017). The act also added the triple-tax exemption making Puerto Rican
bonds attractive to U.S investors by awarding lenders to the island exemptions from local, state,

62
and federal taxes; a policy which later facilitated the island’s excessive debt accumulation.
Lourdes Dick (2015) writes,
“In 1916 municipal bonds were the premier investment security because they were
exempt from increasingly higher income tax rates. However, the supply of municipal
bonds was very low. By ensuring, through federal law, that Puerto Rican public debt
would receive the most preferential tax treatment available to municipal bonds, Congress
deflected attention away from the fact that the United States had installed an ineffective
system of taxation in Puerto Rico, which did not generate sufficient governmental
revenue. It also capitalised on the island’s plight by expanding the municipal bond supply
for U.S. investors.”
The exemption was justified because residents of U.S. territories are not required to pay
income tax and consequently the U.S. government could reduce Puerto Rico’s federal funding
(Wells, 1969). Wall Street financiers significantly benefited from the exemption as they pushed
it on investors who were seeking a higher rate of return (Fusté, 2017). The Act did nothing to
resolve the politically uncertain issue of status, but it did help facilitate the transformation of
politics on the island and with the United States (Wells, 1969).
Another Act also known as the Jones Act, from Section 27 of the Merchant Marine Act
of 1920 (also referred to as the Law of Cabotage), required all goods destined for Puerto Rico be
transported only on vessels owned and registered by a U.S. company, with a mostly U.S. crew,
and constructed in the U.S. The justification for this was that it would protect the shipping
industry and their profits and create shipbuilding jobs in the United States, especially following
the shipping shortages that occurred in World War I (Scott, 2018). Moreover, it enabled the U.S.
to retain a fleet of vessels that could be used by the military. However, as domestic shipping

63
rates are more expensive than global market rates, the Act artificially inflated the cost of
shipping between American ports and severely limited the number of vessels that could transport
goods. It’s still in force today, over 100 years later. Alaska, Hawaii, Puerto Rico, and Guam are
the most severely affected due to the large shipping distances from the mainland and the fact that
other forms of transportation, such as trains and trucks, cannot be used (Grennes, 2017).
Although special interests benefit from preserving the status quo, Puerto Rico and other
geographically crippled regions have been burdened with the cost.
Political developments and contentions
During the first decades of occupation, political parties focused on status-related
concerns. The Union Party, which was founded in 1904 by Luis Muñoz Rivera, Rosendo
Matienzo Cintrón, Antonio R. Barceló, José de Diego and Juan Vías Ochoteco, dominated
politics between 1904 and 1928 and persistently requested a final solution regarding Puerto
Rico’s political status (Bianco-Rivera, 2005). Ideological diversity within the Union Party
prompted the exodus of independence supporters, who later founded the Party for Independence
in 1912. In 1922, the Nationalist Party of Puerto Rico was founded and subsumed the Party for
Independence, in opposition to the Union Party that had removed independence as an option to
resolve Puerto Rico’s political status (Bianco-Rivera, 2005).
The Nationalist Party was principally led by Dr. Pedro Albizu Campos. As the first
Puerto Rican ever admitted to Harvard in 1913, he later returned to Harvard for law school in
1919 and, rather than accept one of many prestigious job offers, he devoted himself to
campaigning and networking for Puerto Rican independence to end the colonial system (Denis,
2015). He became vice president of the Nationalist Party in 1924, followed by president in 1930,
a position he held until his death in 1965. In 1936, Albizu Campos was sent to La Princesa jail in

64
San Juan for conspiracy to overthrow the U.S. government and, following appeal, he was moved
to the U.S. penitentiary in Atlanta on 7 June 1937.
On Palm Sunday, in March 1937, nearly 300 Nationalists assembled outside the
Nationalist Club in Ponce and then paraded through the streets in support of Albizu Campos. At
the last minute, Governor Blanton Winship ordered the permit for the march to be rescinded and
the police chief to increase police presence and thwart the demonstration by using any means
necessary (Denis, 2015). One shot was fired from an unknown origin, followed by a succession
of shots from the police with rifles and Tommy guns that lasted for 13 minutes (Denis, 2015).
Nineteen people were killed, including two policemen and a seven-year-old girl caught in the
crossfire, and over 200 were wounded. Many of the wounded were subsequently arrested in their
hospital beds and the Ponce district attorney was ordered by the governor to indict innocent
survivors for “murdering” themselves; although, the district attorney resigned his post before
carrying out the order (Pérez-Marchand, 1972, p. 24). The insular press described the event as a
“massacre”, “killing”, and “slaughter”, while U.S. newspapers, described the incident as a “riot”
(Denis, 2015). An enquiry several months later by the American Civil Liberties Union labelled
the event a MASSACRE (caps theirs), and concluded that the use of force was sanctioned by the
governor against anyone who would exercise their right to assembly and free speech, and that the
Ponce Massacre (Masacre de Ponce) stemmed from the police, via the governor of Puerto Rico,
prohibiting citizens to parade and assemble (Denis, 2015).
Albizu Campos returned to Puerto Rico in December 1947, after spending six years in
prison, two years in the Columbus Hospital in New York, and two years living in the Bronx
(Denis, 2015). On the orders of J. Edgar Hoover, the first Director of the Federal Bureau of
Investigation (FBI), Albizu Campos and other Nationalists were heavily harassed and surveilled

65
and hundreds of carpetas (surveillance files) were created. In 1948, when the Nationalist
movement was gaining popularity, Law 53, also known as the Gag Law, or Ley de Mordaza,
made it illegal to talk about independence, organise groups of people to attempt to undermine the
insular government, or own or display a Puerto Rican flag, else risk being arrested and jailed
(Denis, 2015). The Gag Law was overturned by the U.S. Supreme Court in 1957, which deemed
it unconstitutional.
José Luis Alberto Muñoz Marín, the son of Union Party founder, Luis Muñoz Rivera,
followed in his father’s political footsteps after spending the 1920s leading an irresponsible
“bohemian” life in Greenwich Village, leaving his wife and two children behind in Puerto Rico
and repeatedly asking his wife and mother for money. A talented journalist and poet, he used La
Democracia, a newspaper that he had inherited from his father, to demand independence for
Puerto Rico. Despite being an opium addict who had acquired a reputation as a “failed poet,
dilettante, high school dropout, bohemian wise guy, bon vivant, erstwhile socialist, heavy
drinker, prodigal son, deadbeat dad, and miserable husband”, Muñoz Marín was elected to the
Puerto Rican Senate in 1932 (Denis, 2015, p. 97). In 1938, Muñoz Marín founded the Popular
Democratic Party (PDP), and by 1940, he had become president of the Puerto Rican Senate
(Duany, 2017). In 1943, he unexpectedly opposed the Tydings independence bill, which was
modelled after the Tydings-McDuffie Bill of 1934 that had enabled the Philippines to acquire
independence. Even though his father had fought for independence his entire life, Muñoz Marín
continued to oppose the bill, until 1946, when he declared he was no longer an independentista
(Denis, 2015). J. Edgar Hoover, Director of the FBI, had brought Muñoz Marín under the control
of U.S. interests, as the FBI had uncovered evidence from reliable informants that Muñoz Marín
was an opium addict and they used his position in public office to bury his involvement in an

66
important narcotics case (Denis, 2015). In 1948, five months after the Gag Law was passed,
Muñoz Marín became the first elected native governor of Puerto Rico as the leader and founder
of the Popular Democratic Party (PDP).
Economic development
Law 346, better known as the Industrial Incentives Act (1947), brought about the state-
run programme known as Operation Bootstrap (Operatión Manos a la Obra in Spanish).
Consequently, the Puerto Rican economy grew, employment increased, and living standards far
surpassed the rest of Latin America and the Caribbean for 25 years after World War II (Collins et
al., 2007). Headed by Teodoro Moscoso, the Economic Development Administration (popularly
known as Fomento), was the government agency responsible for promoting the benefits of
Operation Bootstrap to mainland companies. The law exempted qualifying manufacturing
businesses from paying insular income taxes until 1959 and partially until 1962, as well as
exempting them from paying licence fees and property, municipal, and excise taxes (Dietz,
1986).
5
At that time, José Luis Alberto Muñoz Marín controlled the Senate and the focus was
economic development, rather than independence. Attracting American businesses and investors
to the island via tax incentives would have been impossible if Puerto Rico had broken its
political and economic relationship with the United States (Maldonado, 1997). The aim was to
shift labour from agriculture to the manufacturing industry to lift Puerto Ricans out of extreme
poverty. The island offered several competitive advantages to U.S. investors, including a cheap
abundant labour force, a common currency, and free access to the U.S. market (Duany, 2017). In
addition to offering tax incentives, the government also subsidised the construction of factory

5
Barron’s National Business and Financial Weekly headlined an article with “Puerto Rico Spreads Bounty for
Industry” and the Wall Street Journal described Puerto Rico as a “Taxpayer’s Paradise” (Perloff, 1950, pp. 108, n7).

67
buildings, and work training programmes (Duany, 2017). These benefits allowed U.S.
corporations to significantly boost profits by locating subsidiary operations in Puerto Rico, rather
than on the mainland or in other foreign locales (Dietz, 2003). Since new firms were typically
subsidiaries of a U.S. company, the establishment of new industries on the island, such as
pharmaceuticals, high-tech, and electronics, had few benefits to the local economy in the early
years of Operation Bootstrap, apart from wages paid to the local workforce (Dietz, 1986). From
the 1970s, manufacturing dominated the Puerto Rican economy and agriculture paled into
relative insignificance (Duany, 2017). In 1948, there were 24 manufacturing plants in operation
on the island; while there were 50 in 1949, 80 in 1950, and more than 300 in 1955, and by 1959,
there were 530, with another 91 in the process of being built (Maldonado, 1997).
Between 1973 and 1976, a global recession caused by increasing oil prices brought
Puerto Rico’s growth to a halt. The island was also becoming less competitive because of rising
minimum wages, which prompted manufacturing plants to relocate to alternative more
economically advantageous countries, such as Mexico and Singapore. Thus, in 1976, Section 936
of the Tax Reform Act expanded Operation Bootstrap, to replace Section 931 of the Internal
Revenue Code. The new law provided a tax credit for U.S subsidiaries operating in Puerto Rico,
which essentially enabled them to remit their profits to the parent corporation while excluding
their income from federal tax liability (Bosworth & Collins, 2007). The qualifying corporations
were obligated to pay a “tollgate” tax to the Puerto Rican government on any dividends paid to
the parent company. This was set at a maximum of 10 percent, but could be reduced to 4 percent
if not all earnings were remitted and the remainder was invested in qualifying accounts in
financial institutions (Dietz, 1986). As a result, many industries - the pharmaceutical industry in
particular - transferred huge segments of their manufacturing operations to the island. Between

68
1980 and 1990, Johnson & Johnson saved $1 billion in federal taxes; Merck & Co. saved $749
million; Bristol-Myers Squibb saved $627 million; and Smith-Kline Beecham saved $987
million; as a result, Puerto Rico became the world’s largest producer of pharmaceuticals (Denis,
2015). The provision stimulated the local financial and service sectors and expanded investments
in Puerto Rico and throughout the Caribbean (Dietz, 2003). However, due to the substantial
revenue loss to the U.S. Treasury, President Bill Clinton signed the Small Business Job
Protection Act to gradually phase out Section 936 between 1995 and 2006. The largest impact of
removing Section 936 was the loss of tens of thousands of local jobs due to U.S. corporations
downsizing their operations or leaving the island altogether (Mora et al., 2017). Less educated
workers were affected the most and, consequently, out-migration of lower-skilled manufacturing
workers increased after 2006 (Mora et al., 2017). Further, due to the corresponding loss in bank
deposits in Puerto Rico brought about by the mass exit of manufacturing firms, access to credit
among island residents and businesses was reduced. Subsequently, after 2006, Puerto Rico’s
economy was significantly weakened, and the government’s public debt spiralled, fuelled by the
financial policies enacted by Washington.
Most of Puerto Rico’s debt is unpaid interest on capital appreciation bonds (CABs),
which are essentially municipal payday loans. Debt payments are moved into the future while
unpaid interest is added on to the amount owed and compounds. The Puerto Rican government’s
borrowing extends back to the 1970s, when it borrowed to cover essential expenses. Over the
years, and more so after Section 936 was phased out, the government further increased the levels
of borrowing merely to pay the interest on moneys borrowed many years before (E. Morales,
2019). The Refund America Project has estimated that $33.5 billion of the debt is merely
investor profit, which constitutes an effective interest rate of 785 percent (Bhatti & Sloan, 2016).

69
As a territory of the United States, the Puerto Rican government cannot declare bankruptcy; an
option that would have been available before 1984 under Chapter 9 of the U.S. bankruptcy code.
In 2016 the U.S. government intervened to address the public debt, after Governor García Padilla
declared the debt unpayable, when then President Obama signed the Puerto Rico Oversight,
Management, and Economic Stability Act (PROMESA – the Spanish word for “promise”) into
law. PROMESA ensured creditors would be paid, regardless of the debt’s legality. The Act
restructured the debt and put the island’s fiscal affairs under direct federal control. It mandated a
Financial Oversight and Management Board (FOMB), known colloquially as “La Junta” (from
“La Junta de Control Fiscal”), which took power in January 2017 (Duany, 2017). The board -
and McKinsey & Company, the management consulting firm it hired (which also happened to
own more than $20 million in Puerto Rico bonds) - implemented austerity measures, including
the reduction of public services, closing schools, and privatising public infrastructure, to shrink
the local government’s spending. It also increased the sales tax, which reached 11.5 percent in
2017, the highest sales tax in any state or territory, simply to raise the necessary funds for debt
repayment and not for maintaining public services (Bonilla, 2020). The FOMB also removed
practically all legislative powers from Puerto Rican elected officials and cost the Puerto Rican
government $1.5 billion over its initial five-year term (E. Morales, 2019). It further transferred
all local government power to a new economic infrastructure, controlled by corporations, and
restructured the debt to benefit the U.S. financial sector, further cementing America’s colonial-
legal control and the island’s continuing dependency on American capital. As observed by Fusté
(2017), Puerto Rico’s debt, unemployment, and poverty rates are similar to other U.S. colonial
locations and Native American tribal reservations, which “have dependent and volatile local
economies compared to the economies of the fifty states” (p. 105).

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Migration under American rule
Driven out by the Great Depression, many Puerto Ricans migrated to the mainland in the
1920s, 30s, and 40s. During the 1920s the number of Puerto Ricans living in New York
increased from 8,500 to 45,000 and by 1940, 90 percent of the Puerto Ricans who had relocated
to the mainland were living in New York (Hinojosa-Ojeda, 1994). After World War II, during
Operation Bootstrap, out migration to New York boomed because of the greater earning potential
in the city, even though there were better employment opportunities in Puerto Rico (Hinojosa-
Ojeda, 1994). Since the 1960s, Puerto Rico received an increasing number of return migrants,
and a growing number of foreign immigrants from neighbouring countries and islands, such as
Cuba and the Dominican Republic (Duany, 2007). Cubans began to arrive in Puerto Rico soon
after the victory of the Cuban socialist revolution in 1959. Most were entrepreneurs and
businessmen of high socioeconomic status working in key sectors such as mass media,
professional services, construction, and retail (Martínez-San Miguel, 2003; Duany, 2017). Puerto
Rican commercial television depicted Cuban men as forceful business owners who wore gold
chains and smoked cigars and Cuban women as sensual and attractive, who wore extravagant
jewellery. Their stereotyped characters often hoped that they would one day return to Cuba to
reclaim their property, after the passing of Fidel Castro (Rivero, 2005). The characters were
presented reasonably accurately, as a large proportion of Cubans were self-employed traders,
independent professionals (e.g. independent physicians and accountants), and other businessmen.
The median income and educational attainment of Cubans were also higher than those of Puerto
Ricans (Cobas & Duany, 1997). Comparatively, Dominicans started migrating to Puerto Rico
soon after the 1961 assassination of the Dominican President, Rafael Trujillo (Martínez-San
Miguel, 2003). In the 1970s and 1980s, many educated and skilled Dominicans arrived on the

71
island seeking economic opportunities and in the 1990s, many working-class Dominicans arrived
illegally following the Dominican Republic’s economic crisis (Díaz-Garayúa, 2015). While
many arrived without legal documents, a high proportion married a U.S. citizen or permanent
resident in order to legalise their status (Duany, 2011). Many Dominicans have also used Puerto
Rico as a temporary stop in their journey to the mainland U.S. (Duany, 2011).
Unlike the Cubans, the Dominicans were stereotyped as criminals or cheap migrants that
steal the jobs of resident workers (Duany, 1990). Cubans often experience higher social mobility
than Dominicans in Puerto Rico. They are perceived to be whiter than Dominicans, they are a
smaller group, so are seen to cause less friction, and they possess a different migration status to
Dominicans as Cubans are almost automatically eligible for U.S. citizenship due to coming from
socialist country (Díaz-Garayúa, 2015). Dominicans are currently the most prevalent and most
visible minority group, and by 2000, there were 19,973 Cubans and 56,146 Dominicans in Puerto
Rico (Díaz-Garayúa, 2015).
When Operation Bootstrap began to consolidate agricultural production in the 1950s and
the island transitioned to an industrial economy, many rural residents lost jobs and land. Surplus
labour was exported to the U.S. and the Puerto Rican diaspora grew in cities such as New York,
Philadelphia, Boston, and Cleveland (E. Morales, 2019). Similarly, when the Section 936 tax
breaks were phased out (1996-2006), which propelled the island into economic crisis, there was a
surge in the out-migration of its citizens. The population has declined since 2004 (Figure 3.2),
due to out-migration and reducing birth rates; consequently, the island has an aging population.
By 2015, Puerto Rico was losing doctors at a rate of one per day on average, who left to pursue
more lucrative opportunities on the mainland (Begnaud, 2018).

72

Figure 3.2. Puerto Rico’s Population, 2000-2017 (Trines, 2018)
Between 2010 and 2020, Puerto Rico’s population declined by 11.8 percent (U.S. Census
Bureau, 2020). Puerto Ricans have continued to leave the island year on year, and even more so
since Hurricane Maria struck (Figure 3.3). Tech firm Teralytics estimated that between August
2017 and February 2018 407,465 Puerto Ricans left the island, while 359,813 returned to the
island (Leger, 2019).

Figure 3.3. Puerto Rican Population in Puerto Rico and the United States, 2000-2019 (Centro,
2020)
Citizens’ quality of life has been impacted by the high costs of living, taxes, and
unemployment levels and, due to migration flows, the number of citizens with a college degree

73
in Puerto Rico has decreased (Abel & Deitz, 2014; Flecha et al., 2017). Hurricane Maria further
exacerbated both out-migration and the economic crisis (Figure 3.4). Educated and professional
residents typically relocated to major U.S. cities, whereas many less skilled workers moved to
Central Florida and Orlando. Those leaving were typically escaping unemployment and lack of
opportunity and about half of those leaving were under 24 years old (Begnaud, 2018). By
September 2020, Puerto Rico’s unemployment rate was 16.7 percent; more than 7 percent higher
than the national average (Guzman, 2020).

Figure 3.4. Post Maria Out-Migration (Leger, 2019)
Levels of out-migration due to natural disasters, and lack of employment opportunities
undoubtedly affected the lives of those remaining on the island. The “migration pessimists”
would argue that the out-migration, may contribute to underdevelopment as it drains the island of
its scarce human and financial resources (Bastia & Skeldon, 2020). As Papademetriou (1985)
posits, in sending countries, such migration contributes to “the evolution into an uncontrolled

74
depletion of their already meagre supplies of skilled manpower and the most healthy, dynamic,
and productive members of their populations” (p. 212). This issue is of particular concern to
Puerto Rico as it is a small island with a limited supply of human capital. After many individuals
leave relatively poor Puerto Rico, as Massey et al. (1999) explain, outside financial and human
investment is likely to pour into the poor nation due to the scarcity of capital there, which is
further facilitated if the poorer nation enacts laws to attract and retain businesses, talent, and
wealthy new residents.
Government policy and the U.S. migration boom
The United States is the only country that has a global tax reporting and compliance
regime whereby citizens are taxed on their worldwide income, even if they live abroad. U.S.
citizens are also penalised if they renounce their citizenship, as they must pay the enormous exit
tax (up to 23.8 percent) on their net capital gains to the Inland Revenue Service (IRS).
Comparatively, even though Puerto Rico’s tax system is independent from the U.S., migrants
from the mainland to Puerto Rico are not required to pay the exit tax as they can maintain their
U.S. citizenship.
Over the past few decades, San Juan, the island’s capital, and several surrounding areas
have experienced significant levels of development and gentrification. Beaches are eroding both
naturally and through human action, and prime coastal real estate has been taken over by hotel
chains, resorts, and luxury condominiums (e.g. around Dorado Beach and Condado) (Swords &
Mize, 2008). Rent for luxury beach-side apartments can be as much as $20,000 per month and
homes in the affluent Dorado Beach area average $2,550,000 to buy (Xome, 2021). A high
percentage of these are owned by expatriates. In addition to an influx of tourists, relatively
affluent individuals from the mainland are arriving in droves. As well as avoiding the U.S. exit

75
tax, many of these migrants are motivated by the Act 20 and Act 22 tax incentives offered to
companies established in Puerto Rico that export services to other jurisdictions and to individual
investors who relocate to Puerto Rico. The incentives programmes intended to attract financial
investors and help position Puerto Rico as a “global investment destination” with a view to
boosting fiscal revenues sufficiently to pay off its debts. Between 2012 and 2019, 1,924
companies had qualified for Act 20, and 2,331 individuals had qualified for Act 22 (Fajardo,
2020).
Act 20 and Act 22
With few options for addressing continued debt, the Puerto Rican government tried to
attract outside investment. Enacted in 2012 under then Governor Fortuño, the Act 20 and Act 22
legislation sought to attract high-net-worth individuals to Puerto Rico to stimulate the struggling
economy through the creation of new jobs, real estate investments, and the use of local services.
Act 20 was principally enacted to accelerate the transition of Puerto Rico’s economic activity
from manufacturing towards an export-led and advanced services industry; while Act 22 aimed
to attract individuals from foreign jurisdictions to Puerto Rico, to address the dwindling of the
population caused by out-migration to the United States. The tax incentives were integral to the
government’s economic development plan that focused on strategies to increase the flow of
funds to the island, such as attracting private capital, increasing competitiveness, improving
education, and encouraging innovation, technology, and exports of products and services (Laboy
Rivera, 2016).
To qualify for Act 20 the service provider had to apply via the Department of Economic
Development and Commerce (DDEC) online platform, and for Act 22, the individuals needed to
apply via the Office of Industrial Tax Exemption of Puerto Rico. This enabled the service

76
provider/individual to obtain a tax exemption decree contract between themselves and the Puerto
Rican government. The benefits of Act 20/22 were held throughout the decree term, regardless of
changes in applicable Puerto Rican tax law.
Act 20, also known as the Export Services Act, aimed to promote Puerto Rico as an
international export service centre. To qualify, the exported services could not be connected to
Puerto Rico and the business could not have any previous connection with Puerto Rico. Eligible
services included: research and development; advertising and public relations; consulting and
advice; creative industries in design, arts, media, and creative services; engineering,
architectural, construction, and project management; legal, tax, and accounting; centralised
management (e.g. planning, distribution, and logistics); electronic data processing; computer
program development; telecommunications; call centres; storage and distribution; educational
and training; hospital and laboratory; financial services; commercial distribution; preparing
products for export; marketing centres; and trading companies (Act to Promote the Export of
Services, 2012). Decree holders were subject to a fixed income tax rate of 4 percent on income
derived from the export of services, which could be reduced to 3 percent if certain conditions
were met. Moreover, dividends or benefits generated by eligible companies were a 100 percent
exempt from Puerto Rico income tax. Decree holders also enjoyed either a 60 or 90 percent
exemption on municipal taxes, depending on the location of the business, and a 100 percent
exemption on property taxes for the first five years, followed by a 90 percent exemption after
that. Both foreign and local corporations were eligible. Patently, the aim was to promote global
market engagement without harming local competition and those organisations working in the
blockchain ecosystem align well with this objective as they tend to produce digital products and
services which are cheap to export at scale compared to traditional business models.

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Act 22, also known as The Individual Investors Act, aimed to stimulate the economy by
attracting individuals from foreign jurisdictions to Puerto Rico, and counterbalance the high out-
migration rate to the U.S. mainland from the island. The individual needed to become a resident
of Puerto Rico and use Puerto Rico as their primary tax home. They needed to be present on the
island for at least 183 days, or be present in the United States for no more than 90 days during
the tax year, or be present on the island more than in the United States, and have no more than
$3,000 of earned income there. They also could not have a “closer connection” to the United
States during a tax year. Accordingly, individuals should not have a permanent home, spouse, or
children on the mainland, and they needed to have a personal bank account and voter’s
registration in Puerto Rico. Decree holders benefited from a 100 percent tax exemption on all
interest and dividends from Puerto Rico and any capital gains accrued after establishing
residency in Puerto Rico. Tax on long term capital gains from investments acquired before
becoming a Puerto Rican resident was 15 percent for capital gains realised within ten years and 5
percent after ten years of becoming a Puerto Rican resident. As well as U.S. nationals, the Puerto
Rican diaspora, and other foreign investors could qualify for the decree. However, Puerto Ricans
were not eligible to apply unless they were not living in Puerto Rico between 2006 and 2012.
Act 60
The debt crisis is an ongoing issue for Puerto Rico and with its hands tied by Washington
and few other options, the local government has continued to apply its historical remedy of tax
breaks to bring in outside investment. On 1 July 2019, the Governor of Puerto Rico signed Act
60 (the Incentives Code) into law, which replaced the former Act 20/22 legislation and
consolidated many other tax decrees, incentives, and benefits. Act 60 aimed to improve
transparency and formalise the process for granting and supervising the tax incentives and

78
focused on Return on Investment (ROI). Chapter 3 replaced Act 20 and Chapter 2 replaced Act
22. Both chapters introduced several substantial changes to the old Act 20/22 regulations. Any
Act 20/22 applications filed before 31 December 2019 were grandfathered in under the previous
rules. Due to the increase from $5,000 to $10,000 of the Act 22-mandated annual charity
donation, and the new requirement to purchase residential property within two years, there was
an influx of applications in the run up to the 31 December deadline, even from applicants who
themselves had not yet physically migrated to the island. In fiscal year 2020, the government
approved 490 export services decrees and 820 individual investor decrees (Laboy Rivera, 2020).
Details of the main provisions of Act 60, as compared to Act 20/22 are outlined below in tables
3.1 and 3.2.
Table 3.1. Act 20 (The Export Service Act) Benefits, Rules, and Amendments.
Act 20 pre-2020 Act 20 post 2020 (Act 60)
Benefits
Corporate tax exemption 4% (on Puerto Rican sourced
income)
4% (on Puerto Rican sourced
income)
Property tax exemption 90% (limited to specific
services)
75% (any eligible export
service or export commerce
activity)
100% for the first five years
of operation (small and
medium businesses)
Municipal licence tax
exemption
60% 50%
100% for the first five years
of operation (small and
medium businesses)
Dividends / profit
distribution exemption
100% 100%
Term 20 years
(possible 10-year extension)
15 years
(possible 15-year extension)
Rules
Company location Puerto Rico Puerto Rico

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Office location Puerto Rico Puerto Rico
Employees No requirement Businesses with an annual
business volume greater than
$3 million must hire at least
one full-time employee for
service export activities and
three full-time employees for
manufacturing activities

Other Amendments

Eligible [export service]
business activities
Includes: R&D, public
relations, consulting services,
graphic services, call centres,
medical services, investment
banking, financial services,
and others
Blockchain-related services
explicitly included:
“Distribution in physical
form, in the internet, by cloud
computing or as part of a
blockchain and the income
derived from the licensing,
subscription of the program
or service charges”
Reporting Annual report on all the
incentives requested and
granted published by the
Department of Economic
Development and Commerce
(DDEC)
Annual report on all the
incentives requested and
granted published by the
Department of Economic
Development and Commerce
(DDEC) – includes business
name, shareholders, decree
date, municipality of
business, number of jobs
created
Auditing Independent audit performed
at least every two years by
the Office of Industrial Tax
Exemption (OITE)
Independent audit performed
at least every two years by
the Office of Industrial Tax
Exemption (OITE)

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Table 3.2. Act 22 (The Individual Investors Act) Benefits, Rules, and Amendments.
Act 22 pre-2020 Act 22 post 2020 (Act 60)
Benefits
Interest dividends
and capital gains
100% tax exemption
(after establishing
residency)
100% tax exemption
(after establishing residency)
Term 20 years
(possible 10-year extension)
15 years
(possible 15-year extension)
Expires 31 December 2035
Rules
Real estate No requirement Must purchase residential
property within two years,
which must be the grantee’s
primary residence and can’t
be leased or rented during
the year
Annual charitable donation $5,000 $10,000 ($5000 to one entity
specified in a list by the
government and $5000 to a
charitable entity determined
by the grantee)
Other Amendments
Eligible capital gains
exemptions
No definition for
“securities” or “other assets”
Securities are defined and
other assets are defined to
include commodities,
currencies, and any other
digital asset or blockchain
technology
Eligible individuals Could not have been a
Puerto Rican resident for six
years preceding 17 January
2012
Could not have been a
Puerto Rican resident for ten
years preceding 1 July 2019
Reporting Annual report on all the
incentives requested and
granted published by the
Department of Economic
Development and
Commerce (DDEC)
Annual report on all the
incentives requested and
granted published by the
Department of Economic
Development and Commerce
(DDEC)

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A study commissioned by the Puerto Rico Economic Development and Commerce
Department (DDEC), found that between 2015 and mid-2019, the fiscal impact of Act 20
businesses was about $210 million (total taxes: municipal taxes, corporate income tax, payroll
income tax, sales and use tax (SUT) from payroll) and 8,257 new jobs were created for “export-
related activities”, with the average salary estimated at $36,424. Between 2012, when the law
was enacted, and mid-2019, about 36,222 jobs were created and total investments totalled over
$1.2 billion (Estudios Técnicos & Puerto Rico Economic Development & Commerce
Department (DDEC), 2019). Comparatively, 68 percent of Act 22 grantees invested just over
$1.3 billion in real estate from which the government collected about $8.8 million in property tax
and 32 percent spent approximately $560 million per year on rent. They consumed around $141
million in goods and services and around 35 percent of grantees started a business in Puerto
Rico, including many that operated under Act 20. More than 81 percent of decree holders had a
net worth of less than $10 million, and 2.8 percent had a net worth over $50 million (Estudios
Técnicos & Puerto Rico Economic Development & Commerce Department (DDEC), 2019).
Blockchain migration
Along with Puerto Rico’s history and policies, additional elements must be considered to
explain the increasing numbers of blockchain lifestyle migrants arriving on the island, and the
even sharper increase following Hurricane Maria in 2017. Crypto/blockchain migration first
began in early 2016, when Michael Terpin, a blockchain company founder, investor, and advisor,
moved from the U.S. mainland to Puerto Rico. Such migration has since accelerated, especially
after blockchain billionaire and ex child actor, Brock Pierce moved to the island during the
winter of 2017. Soon after Pierce’s arrival, the New York Times published an influential story
about the crypto/blockchain community in Puerto Rico under the headline: Making a Crypto

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Utopia in Puerto Rico, which highlighted the unparalleled tax incentives for U.S. citizens and
followed the lives of the then new crypto/blockchain arrivals (Bowles, 2018). The article created
a buzz that was evident at blockchain conferences on the mainland and in Puerto Rico, especially
as it highlighted Puerto Rico’s generous tax incentives that were relevant for the many early U.S.
bitcoin/altcoin adopters who had made unprecedented returns on their original investments
during the 2017 crypto bull run. Brock Pierce was a keynote speaker at a number of these
conferences. He and others pointed out the benefits of moving to the island in their presentations
and discussions at receptions and networking events, often citing other well-known figures (such
as gold advocate Peter Schiff) who had relocated to the island; this was both my personal
experience on the mainland and in Puerto Rico in 2018, as well as the experience of many of my
research participants. Numerous individuals found out about and attended conferences in Puerto
Rico because they had read Bowles’ article. Lots of other media coverage followed, including a
Rolling Stone article titled: Brock Pierce: The Hippie King of Cryptocurrency: Brock Pierce
went from child actor to Bitcoin billionaire – now he wants to turn Puerto Rico into a Burning
Man utopia (Strauss, 2018); a BBC audio documentary titled: Crypto Rico: Blockchain for a
Broken Paradise (Abuchaibe & Brown, 2018); an NPR audio documentary titled: Puerto Crypto
(Cotler & O’Brien, 2019) and a Channel 4 (UK) television documentary titled: Adventures in
Futureland: The Bitcoin Billionaires Club (McConnell, 2019). Some coverage focused mainly
on the more sensationalised aspects of the migrants’ lives (e.g. NPR) and others were more
objective in their reporting style (e.g. BBC). While broadcast/published at different times, all
programmes and articles were recorded/written in mid-2018, the year when large numbers of
blockchain migrants moved to the island.

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These factors were catalysts for migration decisions. In addition, the formation and
emergence of blockchain migrant networks in late 2017 and the beginning of 2018 shaped
aspirations and motivations for migration. These networks were primarily formed and sustained
by professional ties and incorporated all forms of social capital identified by Portes and
Sensenbrenner (1993): value introjection, reciprocity exchanges, bounded solidarity, and
enforceable trust. They enabled value introjection because individuals from the blockchain
community were motivated to relocate to Puerto Rico for comparable reasons. The networks
operated as reciprocity exchanges due to [blockchain migrant] group affiliation and “in-group”
favours and information exchanges, which included word-of-mouth recommendations for on-
island service providers (e.g. for tax lawyers) and business introductions. Blockchain migration
experiences created bounded solidarity, especially as migrants shared situational circumstances,
such as interests and life conditions, which cultivated a common community origin. Finally, a
regime of enforceable trust was achieved through the power of community, whereby an
individual’s actions were oriented towards the expectations of the blockchain migrants as a
collective group, so anyone seen not to be adhering to these norms might find themselves
ostracised and lose trust with the group.
Social ties with current and/or former migrants developed through personal and/or
professional networks facilitated the creation and maintenance of social capital, which lowered
the costs and risks of migration. Former experienced migrants, for example, could use their
knowledge to reveal cost- or time-saving shortcuts and strategies. Once the first migrants moved,
it became much easier and cheaper for others in their existing networks to join them as those
who had already migrated could aid the journeys of those who had not yet moved (as was
evident during conference presentations and associated events both on and off the island).

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Conferences, such as CoinAgenda, and regular blockchain events, such as CryptoMondays,
attracted travellers and individuals on business trips, and local residents, and made visible the
strong crypto community that had developed on the island. Networking opportunities provided
by these events often strengthened or helped establish social ties to current and former migrants.
As the costs and risks of movement are significantly reduced once a critical threshold of
migrants is reached, which in turn increases the probability of more migration, the migrant social
networks expand and therefore migration is “self-perpetuating because each act of migration
creates the social structure needed to sustain it” (Massey et al., 1999, p. 46).
Many migrants left during the “crypto winter” of 2018, after they lost financial gains
made in 2017 and bitcoin dropped to close to $3,000 from its previous high of nearly $20,000,
making the cost of having the tax decrees no longer justifiable. This is significant as bitcoin’s
price fluctuations tend to correlate with the price of altcoins, so individuals with other crypto
assets at this time also suffered losses. After the bitcoin halving in May of 2020 (this occurs
every 210,000 blocks mined [approx. every four years] when the miners’ block reward is halved,
and serves to increase bitcoin’s scarcity over time), when bitcoin was valued at $8,600, its price
gradually increased and resulted in a bull market in 2021, with prices surpassing $60,000 by
mid-October. This is a typical cycle. Bitcoin was valued at $664.44 at the July 2016 halving, and
over the next 18 months was trading at close to $20,000. Similarly, it was valued at $11.50 on
the day of the first halving in November 2012 and the next 12 months saw its price skyrocket to
$270 (Figure 3.5).

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Figure 3.5. Bitcoin price history and block reward halvings (Sense and Cents, 2021).
Along with typical market cycles, 2020-21 saw a massive increase in the institutional
acceptance of bitcoin and other major cryptocurrencies. For example, PayPal announced the
integration of cryptocurrencies into its platform and its plans to expand the service to Venmo in
2021, JPMorgan launched JPM Coin and a branch for digital asset operations and custody
services, Goldman Sachs started a bitcoin trading desk, Tesla invested $1.5 billion in bitcoin, and
MasterCard announced that it will support cryptocurrencies on its network. Further, Coinbase,
one of the largest crypto exchanges went public with a valuation of almost $100 billion.
More technical developments in the ecosystem also occurred. Crypto exchanges
developed smooth on and off ramps, so users can easily deposit and withdraw larger amounts of
cryptocurrency, compared to 2017, when the user experience was much more disjointed and
required significantly higher levels of skill and knowledge to navigate. Also, while 2017 saw the

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rise of the Initial Coin Offering (ICO), which helped new start-ups to source liquidity via token
sales (but many instances were scams or failures), 2020-21 saw the rise of decentralised finance
(DeFi) and non-fungible tokens (NFTs). NFTs are tokens that represent scarce digital content (or
the future of digital ownership), and the DeFi space has seen the launch of countless
decentralised services, including decentralised exchanges, borrowing, lending, and staking.
Unlike in 2017, when few ICO projects managed to get off the ground, many DeFi projects have
already launched, and more are in the pipeline. Moreover, while CryptoKitties, a game craze for
trading digital cats, was one of the first uses for NFTs in 2017, the NFT space has expanded and
matured somewhat, into many areas such as art, music, videos, or even land in virtual worlds,
like Decentraland. Mainstream media coverage about these developments has brought a huge
crowd of retail and institutional investors and has further fuelled increasing prices in
cryptocurrency markets. Binance regional Director, Josh Goodbody, explained that compared to
2017 when they saw many retail users do a handful of trades on the Binance platform and then
stop, he has seen a different pattern of user behaviour in 2021, with record numbers of new users
coming in and using the platform long term (Binance, 2021). The growth and development of the
crypto ecosystem to a more mature stage provides a solid foundation for wider adoption,
awareness, and utilisation by the end of 2021, which has already resulted in and will further
result in the creation of numerous new millionaires. These millionaires must pay capital gains
taxes on their profits, and Joe Biden, who won the U.S. presidential election at the end of 2020,
plans to raise taxes for Americans earning more than $400,000 per year (Csiszar, 2021).
Relocating to Puerto Rico is one way for U.S. high capital gains earners, in the 2021 bull market,
to adjust to the changing tax policy and minimise the impact on their investments.

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Chapter Conclusion
Puerto Rico’s contentious colonial history of control, enabling the debt crisis via the
triple-tax exemption, unemployment, and poverty rates plus the normalisation of colonial
migration and the government’s latest attempts to fix the economy through tax policy, have
encouraged the recent boom in privileged migration to the island. This, along with
cryptocurrency price fluctuations and external factors in the United States, including the U.S-
Puerto Rico special relationship, global taxation regime, and exit tax, and the formation of local
social networks and community structures in Puerto Rico have created a climate that attracts
blockchain migrants specifically. Such movement has helped to fuel the island’s real estate surge
in parallel to the development of [luxury] properties aimed at the new Puerto Rican residents
(e.g. the Ritz-Carlton Residences in Dorado, which were offered for purchase in 2012). Other
aspects also influence such movement, such as cryptocurrency price fluctuations, and the
availability of rapid travel and effective communication technologies that offer the migrants the
convenience and flexibility to work from anywhere. More recently, COVID-19 has forced many
individuals to adapt to remote working and proved the location independent concept to
employers and employees for various job roles, which has facilitated increased movement from
the mainland. Such structural factors intersect sociological shifts in modern societies, where
increasing numbers of people are escaping the stresses and strains of the urban “rat race” and can
embrace improved lifestyles in alternative locales.
Moreover, the blockchain ecosystem has traditionally attracted individuals who espouse
decentralist values due to the decentralised and consensus-driven nature of blockchain
technology, which enables individuals to have control over their assets without the need for
traditional centralised [trusted] intermediaries. While the blockchain community has matured in

88
recent years, a significant libertarian group remains. These are individuals who are often
pessimistic regarding the role of government and corporations and thus have no expectations that
institutionalised structures will work for or benefit them. They prefer to use their own resources,
rather than rely on centralised authorities to survive and thus are hyper individualised. Therefore,
it is not surprising that dozens of newly wealthy individuals from the crypto/blockchain
community began to relocate to Puerto Rico towards the end of 2017, soon after Hurricane
Maria, when the price of bitcoin reached just short of $20,000, an increase of close to $19,000 in
12 months. Unlike in America, where every crypto trade or transaction is taxable, crypto traders
who have relocated to Puerto Rico under Act 22 or Act 60 are not taxed on their profits. Media
such as the 2018 NY Times article on Brock Pierce and Puerto Rico as a hub for technological
[and blockchain/crypto] innovation and entrepreneurship, as well as wide discussion at
blockchain conferences and events on the mainland and in Puerto Rico, which extolled the
benefits of relocating and highlighted the key blockchain/crypto figures that had moved to Puerto
Rico, together increased the probability of additional movement to the island.
Chapter 4 examines other reasons for blockchain migration and attempts to understand
how the themes and policies highlighted in chapter 3 influence how migrants live their lives.

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Chapter 4 Blockchain Migrant Lifestyles
The previous chapter focuses on the broader structural and socio-cultural contexts that
frame blockchain migration to Puerto Rico. This chapter presents the migrants’ migration
narratives, their individual and shared histories, assumptions, goals, beliefs, and practices, and a
thematic analysis of their accounts. This pinpoints the fundamental interplay between the
aforementioned contexts and the lived, enacted, and embodied experiences of the blockchain
migrants. Further, it captures the driving factors behind initial migration decisions and how the
process of migration is shaped by structural conditions and mediated by multiple actors. These
narratives highlight the blockchain community culture that has come to exist on the island.
Participant Demographics
This section highlights the motivations behind migration decisions, which necessitate a
complex array of active choices that are informed by structural constraints, news in the media,
hype at community events and conferences, and attitudes and expectations in professional and
personal circles. It also draws attention to the diverse social backgrounds of those who
participated in the research. The aim is to spotlight the complexity, colourfulness, and dynamics
of the lives of these migrants and illustrate how they navigate societal structures and demonstrate
that migration practices and modes of living are facilitated by access to various forms of capital
and systems of power.
Although there were several female blockchain migrants on the island who fit the study
profile, most of the potential participant pool was male. Most interactions with female migrants
occurred during informal conversations at events and gatherings, rather than via formal
interviews; however, three interviews with female migrants were conducted. Most of the formal
participants were North American men. The majority were Caucasian, but several were of Asian

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ethnicity. Some participants were born in countries such as Australia, Panama, Vietnam, and
Taiwan or had immigrant parents and held additional citizenship. The cohort included one person
born in the United States to Chinese parents; someone born in New York to Puerto Rican
parents; another born in the United States who had acquired additional citizenship from
Uruguay; and one man who was born in France, held French citizenship, possessed a Green
Card, and had been a U.S. resident since 2003.
The migrants had lived in Puerto Rico for between one month and eight years, with the
majority residing there for an average of two years. Many had migrated to other places with their
families or on their own, before settling in Puerto Rico, living in locales such as Uruguay,
Panama, Costa Rica, Mexico, Chile, Columbia, or other U.S. states, including Hawaii, Florida,
and California. All were English speakers, and while many participants could speak Spanish, the
native language of Puerto Rico at an elementary level, only three were fluent. Others also spoke
fluent Vietnamese, Mandarin, Japanese, or French. Most arrived to take advantage of Act 20, Act
22, or both decrees. Five participants were in the process of applying for Act 60 or had plans to
apply in the future, and one participant was delaying their application as, at the time, it was
cheaper to pay the tax on the sale of their crypto, than pay the donation requirement under Act
60. A small number had decided not to take advantage of, were ineligible to qualify for, or had
not yet applied for the tax benefits. One man had migrated to take a new job and explore the
world; another was a convicted felon; and another had fallen in love with the island during a
short business-related trip and relocated two weeks later. This last individual wanted to take
advantage of the decrees eventually but could not afford the associated costs such as the
mandated $5,000 annual charitable donation, at the time of the interview. Most became aware of
cryptocurrencies / blockchain technology through a friend who had introduced them to bitcoin

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pre 2015 and several had been introduced to cryptocurrencies during their career, for example,
while employed at a hedge fund for cryptocurrency digital assets or working for a project where
they were paid in crypto rather than U.S. dollars. One participant discovered bitcoin in Wired
magazine in 2011 and another became aware of digital currencies while working at the National
Security Agency (NSA) in the mid 1990s, before bitcoin was invented. Most participants were
single, although three were married with young families, three were divorced, one was living
with their partner, and another was married, but separated. All were aged 25-44, aside from four
participants who were aged 45-64.
The migrants appeared relatively culturally homogenous, but the data revealed more
diversity, with respect to their racial, ethnic, and socioeconomic backgrounds as well as their
professional and personal interests. Of those who were comfortable disclosing their earnings (or
their wealth was well documented online), at least one was a billionaire; one earned less than
$25,000, another earned between $25,000 and $50,000, and most earned between $75,000 and
$300,000 per annum. The majority had fluctuating income. Two participants came from working
class or poor backgrounds, and 20 percent of participants indicated they had no degree, while the
remainder had at least a bachelor’s degree and around 20 percent had a master’s degree. One
participant was semi-retired, having made gains from stock options at Uber; others were self-
employed, working as traders and/or investors, running their own businesses/start-ups (with
many being serial entrepreneurs), or working as independent consultants. Participants worked in
real estate, marketing, media, energy, healthcare, finance, IT, and the non-profit sector. They
enjoyed a wide variety of hobbies, including martial arts, basketball, painting, and hiking. They
also took advantage of activities unique to Puerto Rico or island-life living, including dancing
salsa and/or bachata, hiking in the El Yunque rainforest, exploring caves and waterfalls, scuba

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diving, swimming in the ocean and snorkelling, playing beach tennis and beach volleyball, and
surfing. One participant commented that they intended to take more advantage of the island
going forward, having done little exploring in recent years. Another stated that they had a wish-
list of places to visit on the island and wanted to create more free time for hobbies, but their
current work schedule prevented them from exploring. Another explained that his current focus
and source of fulfilment was through building his business rather than the pleasures to be
enjoyed from living in Puerto Rico. Beyond the financial donation requirement affecting those
under Act 22, several were involved in additional philanthropic and voluntary work, donating
time and resources to causes such as Christmas toy drives, beach clean ups, earthquake relief,
blockchain and entrepreneurial education, fundraisers for local low-income communities, and the
COVID-19 response.
Seven interviews were also conducted with local participants who had professionally
interacted with the blockchain migrants in Puerto Rico. The cohort included:
1. Andrés, who was interested in integrating blockchain technology into his hardwood and
sustainable forestry business;
2. Annie, who worked for the Puerto Rico Chamber of Commerce, and the Puerto Rico Science,
Technology, and Research Trust, and was president of The Act 22/22/60 Committee;
3. Antares, the Executive Director at the Integro Foundation, Brock Pierce’s local non-profit
organisation;
4. David, the External Resources and Alliances Director for Centro para Emprendedores, a non-
profit that sometimes sponsored Uncommon EntrePReneurs events;
5. Giovanni, a local blockchain and tax attorney and the go-to lawyer for many blockchain
migrants;

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6. Valaria, a local who moved from Argentina to Puerto Rico when she was 10 years old, and
worked at Levidge, a crypto trading company owned by one of the migrants; and
7. Yarey, who had presented at CryptoMondays and was the director of the Schools in Naguake
non-profit programme, a programme dedicated to immersing children into the Taíno language
and culture that was seeking charitable donations.
These interviews were conducted to gain deeper insight into the impact of blockchain
migration to Puerto Rico and uncover the shared and unique views of Puerto Rican residents,
regarding increased movement of comparatively privileged blockchain migrants from the
mainland.
Histories, motivations, and migration patterns
The lives of the blockchain migrants in Puerto Rico had taken varied paths before
arriving on the island. Their narratives capture the rich tapestry of colourful personalities and
migration contexts, which highlight how social structures, networks, and individual positions
within structures may facilitate migration. They also highlight the varying motivations for
migration, which tend to depend on structural and networked characteristics pertaining to the
timing of relocation.
Many interviewees were entrepreneurs and incredibly mobile. They were pulled to Puerto
Rico by the potential for enhanced economic prosperity through tax incentives and the presence
of a strong blockchain community, and pushed from their sending country, usually the United
States, by high taxes and/or - more recently - because of the coronavirus outbreak. Most had
moved around the United States or lived abroad previously. A small number, like Beck and
James, were born abroad and moved to the United States as teenagers. One participant had only
lived in two states before landing in Puerto Rico and had never left the mainland or owned a

94
passport. The majority migrated to San Juan or the surrounding metro area, which they viewed as
“more expat friendly” due to the numbers of migrants who had already settled there, compared to
other parts of the island. Others settled in Dorado, approximately 30-minutes’ drive from San
Juan. Many had learned about Puerto Rico and its attractive incentives programmes through
professional networks and conferences. Others discovered the island through their own research.
Originally from Minneapolis, Drew was living in Medellin, Columbia in 2018 when he
met several people who were big names in the crypto space who were researching Puerto Rico as
a place to live and conduct business. By then, many investors had profited from the 2017 crypto
bull run, when bitcoin increased in value from less than $1,000 at the beginning of the year to
almost $20,000 by December. So, in March 2018, Drew decided to attend two crypto
conferences in Puerto Rico; Blockchain Unbound and CoinAgenda Caribbean. After learning
more about the island from the conferences, lawyers, and other professionals during his visit, and
realising that several people from his professional network were moving, he decided to migrate
and relocated to the island in June 2018. Similarly, Beck was an angel investor in a company
called Metal Pay that focused on point-of-sale payment solutions and facilitating banking
services for cannabis companies using blockchain technology. Michael Terpin, the first
cryptocurrency investor to move to Puerto Rico, had also invested in Metal Pay and told Beck
about Puerto Rico at a conference in San Francisco in 2018. Like Drew, Beck attended
CoinAgenda Caribbean that year, a conference organised by one of Michael Terpin’s companies,
and was sufficiently impressed by the Act 22 tax incentives and the burgeoning crypto
community on the island that he decided to move.
Other participants attended one or more crypto conferences on the island after first
reading about Puerto Rico and its tax benefits. Following the buzz generated by the conferences,

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they relocated. Alexander was living in San Francisco and his girlfriend at the time showed him
the New York Times article from February 2018 that mentioned the Blockchain Unbound
conference and heavily featured Brock Pierce and the blockchain community in Puerto Rico.
Alexander attended the conference and was “sold”. He explained,
“It was-mind blowing. It seemed everyone from the conference was going to move here,
and I was really excited. Honestly, it was much more like a Vegas kind of feeling than it
ever has been again in my whole time here because every hotel was having crypto events.
It just seemed like, wow, this really is the place for this.”
Similarly, Brian’s business partner read the New York Times article and decided that he, Brian,
and two members of their team located in Utah, needed to travel to Puerto Rico to check out the
“decentralisation-focused people” on the island, including those in the blockchain, crypto, solar
micro grid, and mesh internet spaces. They didn’t initially visit for a conference, but they met
many people in the blockchain community during that visit as well as several lawyers, such as
Giovanni Mendez, a local tax attorney. Brian’s business partner had decided to move, but Brian
needed more convincing. He and his team returned to the island when the back-to-back crypto
conferences took place and presented at two of them. During that trip, he and his business partner
explored the island and what it had to offer with their families and Brian subsequently decided to
move.
Brock Pierce was already known to several participants before they moved. BitsAndMore
(a participant’s pseudonym), for example, was a good friend and business partner of Brock in
California. Brock had talked about Puerto Rico for years, and BitsAndMore knew that Brock
would move there at some point. The tax incentives appealed to BitsAndMore especially as
California is a high-tax state. In late 2017 and near the height of the crypto bull run, he decided

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to make the move at the same time as Brock. In 2018, Pedro, who lived in Miami with his wife,
was on the same blockchain conference circuit as Brock, attending conferences in San Francisco,
Las Vegas, Davos, Zug, and elsewhere. Pedro first met Brock in Palo Alto, and it was there that
Brock explained what he was doing in Puerto Rico, and Pedro, a Puerto Rican born in New
York, was intrigued. He flew to Puerto Rico to visit family and then attend the first Restart Week
conference in March 2018. He was shocked by the number of blue tarpaulin shelters still
sheltering families in the aftermath of Hurricane Maria. After that trip, Pedro decided to move.
He had met many “really talented and really successful” people on the conference circuit, who
had “already made a bunch of money and were at a stage where they wanted to give back and
wanted to help”. He explained,
“I felt like it was my obligation and my duty to come here and be that natural conduit
between the people in the crypto industry and the people in Puerto Rico. Being that so
many people were attracted to Puerto Rico because of the tax benefits, that basically fit
like a glove for people in crypto. I felt like it would be my place to help facilitate those
people in terms of where they wanted to be of service to the people of Puerto Rico and be
able to facilitate that transition for them (blockchain migrants’ transition to Puerto
Rico).”
Pedro differed from many interviewees as he had not taken advantage of the tax decrees
and decided to move primarily to participate in an active blockchain community and help people
in Puerto Rico.
Unlike most blockchain migrants to Puerto Rico, Brock was a famous billionaire. Like
BitsAndMore, he relocated from the high-tax state of California in 2017. Brock had qualified for

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the tax benefits and revealed that it made sense to move to Puerto Rico as it was a “good place to
study” in preparation for running for President of the United States:
“I needed basic training. I needed to go study a state. I didn’t move here for crypto. I
moved here to study food security, energy resilience, economic development, innovation,
and I needed a place to study it. My time here could make a very big positive impact. I
measure my success in life by the impact I have, not by what I have, but by what I give.
This is small enough; three million people, 100 miles long, 39 miles wide, complicated,
nuanced. I can’t think of a better school.”
Like Pedro, Brock wanted to give back to Puerto Rico. Soon after moving in 2017, he started the
Restart conferences around the island to better understand what was needed and where, and how
he could help, especially in the aftermath of Hurricane Maria. He was gifted a non-profit
organisation that already had the necessary federal statuses by a local lawyer, which became the
Integro Foundation a Puerto Rico-based 501(c)(3) and 1101.1 (Act 22/60 eligible) non-profit.
The foundation has supported, for example, endangered and injured animal programmes, local
food banks, and initiatives relating to the coronavirus pandemic, such as donating masks and
supplies to those in need.
Almost all blockchain migrants were benefiting from the tax decrees, even though many
tax decree holders were not involved in blockchain technology. In 2019-2020, Puerto Rico
received almost 3,500 tax incentive applications, which exceeded the combined total for the
previous seven years (Weiss & Wyss, 2021). This was probably due to the replacement of Act 20
and 22 with Act 60 on 1 January 2020, and the increased costs of compliance that included an
increased donation requirement from $5,000 to $10,000 and a real estate purchase requirement
for Chapter 2 (previously Individual Investors Act 22), and an employee requirement for Chapter

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3 (previously Export Services Act 20). Thus, individuals who moved long after the 2017 crypto
bull run rushed to move in 2019, just in time to take advantage of the tax exemption decrees
before Act 60 came into effect.

Figure 4.1. Act 20 and Act 22 application volumes through 30 June 2020 (Weiss & Wyss, 2021)
Jon grew up in Philadelphia and moved to Hawaii in 2004, primarily for the lifestyle, to
hang out with his friends, surf, and work in hospitality to pay the bills. In 2011, he started a
mortgage company from there and in 2015-2016 he began to explore the possibility of moving to
Puerto Rico as a second residence to be a more sovereign individual and live as much as possible
outside the constraints of nation states, especially because he thought the system was broken
after the financial crisis. At the time, Act 20 beneficiaries needed at least five employees and he
came to realise that his business in Hawaii did not qualify as an export services business.
Following amendments to the incentives programmes and repairs to critical infrastructure
following Hurricane Maria, and just before the introduction of Act 60, he was exploring
relocation opportunities again for professional reasons. The favourable economic conditions in
Puerto Rico meant that he could retain more income and have more financial flexibility to “play
in the sandbox” and reinvest more into his business.

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“Even Act 60 is still way more flexible than what Act 20 was two and a half, three years
ago, when you needed five employees. 2019 was really the magic now-or-never type of
year, where you only needed one employee and you could be that employee. That
changes everything. For someone like me, you need that, like the entrepreneur, the leader
is the one who typically pioneers that. They’re the ones first to the frontier. This gave me
the opportunity to come to the frontier of Puerto Rico, get this set up, test it. Is this going
to make sense? Is this something we can leverage without making a huge risk of capital,
hiring a bunch of people when we’re not ready to do that? I’m not running a call centre in
Miami and just moving a bunch of people to Puerto Rico. I’m testing the waters of
various new business objectives.”
Nico was born in France and migrated primarily for economic reasons. He and his wife
were both self-employed in California where the cost of living was extremely high. Due to
housing expenses (for a modest house), public school for his two children, aged 10 and 12, and
medical insurance, he estimated that they needed to make at least $250,000 per year for his
family of four to live in California. He was also looking for a place where he could maintain his
permanent resident status (green card).
“When you are self-employed and you have your own small business, it’s much different
than having a salary. You don’t really look too much at your spending power today. You
look at it within the next 10 to 25 years in terms of your retirement because you have
absolutely no other means to retire at some point. We nearly put 85 percent of the money
in equities to take care of it, just for later. You must restrain yourself a little bit now;
don’t go crazy on trips, holidays, stuff like activities for the kids, but still have fun but
maybe less because you’re running your own business. If something happens like the

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coronavirus, it can happen and you’re like shit, nothing is happening anymore. You don’t
have a salary coming in anymore, so then we looked and said, ‘Okay, we have a green
card, so where can we keep the green card? Puerto Rico was the only area. I mean, you
have Guam as well, and a couple of others but it’s too small. Puerto Rico is right in the
middle between Europe and the U.S. Even though it’s 15 hours travel, it’s easier than
being in Guam or any other area and we can keep our green card.”
In addition to the high cost of living in California, Nico was unhappy with the U.S.
political situation under President Trump.
“I would rather be in an area where the government has corruption like it has here (Puerto
Rico); Latin American corruption. This is more like a Latin American country, than
[mainland] visible racism, white supremacist, and dictatorship. Today, the U.S. reminds
me too much of the 1930s in Germany where everybody hates each other. You can’t have
a conversation anymore without labelling yourself as being a Democrat or Republican.
The amount of racism in the country that has been dormant but has woken up
tremendously since Trump came into power. […] We didn’t identify any more at all. We
just wanted to get out and it’s not like we made a mistake; I am so glad to be here when I
see everything happening in the U.S. I’m very sad for the U.S. but I feel that it went
beyond the point where things can go back to normal without a fight and now there needs
to be a fight.”
Beyond fleeing California’s high cost of living, Nico was escaping the social upheavals
and divisions magnified by Trump’s presidency, while maintaining his residency status. He
imagined a new place where societal division was less pronounced than in the United States. He
appreciated the Puerto Rican approach to life and politics. For example, Puerto Ricans protested

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in response to the leak of offensive Telegram messages (known as ‘Telegramgate’), between the
Puerto Rican Governor Ricardo Rosselló (2017-2019) and his inner circle, and helped force his
removal within two weeks. Nico continued, “People here are in the movie that is being created.
Americans are watching the movie with a box of popcorn.” The change of culture and
community relations and the desire for a better way of life were huge components of his
migration narrative.
The accounts of pre-2020 highlight the varied routes to migration that prominently
featured in the narratives; escaping high-tax and expensive states, wanting to join and live among
the burgeoning blockchain community, and desire to help Puerto Rico in the aftermath of
Hurricane Maria. Although some migration decisions seemed relatively impulsive and stemmed
from a short visit to the island to one or more conferences or to catch up with family, others were
based upon well considered long-term planning, especially in relation to the evolving tax rules.
The ability to act without constraints, to take advantage of any possible opportunities,
underscored the conscious choice, one of the fundamental components of lifestyle migration, that
was evident in all narratives. Choice is privilege and the capacity for making choices is a marker
of class difference and social inequalities (Goldthorpe, 1996; Skeggs, 2013; Benson & O’Reilly,
2018). While individualism, access to resources, and free choice will characterise this privilege
in migration, structural concerns including power relationships, access to different forms of
capital, and policy failures that encourage the creation of tax havens, are arguably more relevant
as they give rise to a multiplicity of social networks based on the privilege of those who can
navigate the systems in place. The blockchain migrants in Puerto Rico enact and embody these
societal structures that enable middle-class populations specifically to utilise their choices most
effectively and thus relocate with relative ease.

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In 2021, large numbers of blockchain migrants moved to Puerto Rico; more than a year
after Act 60 took effect. As Leigh said in May 2021, “It feels like every week we meet someone
new who is coming to test it out or coming to move down.” Narratives of escape were especially
pertinent for blockchain migrants arriving in 2020 and 2021. They tended to be motivated to
leave the mainland by factors relating to the coronavirus outbreak and in a handful of cases, tax
implications imposed by the Joe Biden presidency. Indeed, lifestyle migration is about escaping
from somewhere and something, to a new life – “a recreation, restoration or rediscovery of
oneself, of personal potential or of one’s ‘true’ desires” (Benson & O’Reilly, 2009a, p. 3). As
Ghost explicitly noted, “I guess it’s kind of a joke, when someone gets to Puerto Rico, you just
ask them, ‘What are you running from?’ You’re either running to, or from something if you’re
coming here.” Beyond the obvious tax advantages in Puerto Rico, of which Chapter 2 of Act 60
for Individual Investors was especially valuable during the 2020-2021 crypto bull market,
blockchain migrants were also drawn to the good weather and the strong migrant networks in
place.
During the pandemic, Monika was confined mostly to her apartment in New York, the
epicentre of COVID, where she had witnessed a number of people she was close to pass away
from the virus. She rarely left her apartment in 12 months and was spending a lot of time
gardening, but otherwise her life was on hold. One day she decided, “I really do need to get to a
beach.” She considered Florida and Tulum for the start-up communities they attract but was
concerned about potential disease flare-ups resulting from disregarding masks or other associated
COVID-19 rules. She had heard that Puerto Rico was strict on mask wearing and thought,
“Great, the rules will be taken care of, and I won’t have to be an enforcer, but I’ll just be in an
environment that’s really trying to do right by people, so I’m not going to be causing damage to

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go there.” She had met many people on the conference circuit before COVID, who had moved to
or visited Puerto Rico, and so it had been on her radar for a while. She explained,
“Over COVID, I would hear people, ‘Oh, I visited Puerto Rico or this thing’s happening.’
Facebook was such a big thing for me to get information. It was really friends that may
have visited or said things, or they popped in or whatever. Then I was like, ‘Oh right.
There’s something happening there.’ I knew that when I got here, even to visit, that
people were going to be a lot more social than I was used to. I thought, ‘I’m going to be
in these events where I’m probably going to be exposed to COVID, because it’s
inevitable with this overlap of people, but I’m going to be wearing masks, so I won’t be a
spreader. I’ve already had it and I had one shot, so my likelihood of falling ill to it is
pretty low, but my likelihood of spreading it may be there’.”
During her initial visit in March 2021, she was invited to speak at CryptoMondays. Monika
described the experience as overwhelming as she had spent 2020 alone at home, doing very little.
Whereas, as soon as she arrived on the island, she was interacting with huge groups of smart
individuals from the blockchain community.
“That was like I throw my hands up about dealing with COVID the way that I had been.
It [Puerto Rico] was just completely the opposite. I can’t tell you, 8:00pm would roll
around and I would be like, ‘Shouldn’t I be on bed watching Netflix right now?’ Twelve
months of getting used to just that kind of sedentary, do nothing kind of situation. I spent
eight or nine hours on my computer doing things, mostly trading online, and then I’d
spend probably six more hours just sitting, watching hours of Netflix because there’s
nothing happening. Then just the opposite [in Puerto Rico]. Suddenly the world is open
and alive and here we are and I’m like, ‘Whoa.’ It was overwhelming but then it wasn’t

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just like, ‘Oh, let’s go attend this thing’ (CryptoMondays), it was like, ‘Monika go speak
at it.’ Then, ‘Monika I want to meet with you, meet with you, meet with you.’ It was like,
‘Oh my God, all the business I could ever want is here. All the partnerships, all of the
money, everything that I can ever want is here.’ I just kept thinking, ‘You got to make
hay with sunshine,’ and that’s it. This is the land of opportunity. I have to do it.”
What started as a short trip to check out the island and the blockchain community in March 2021
evolved into Monika deciding to move to Puerto Rico a few weeks later, lured by the vibrant,
tolerant, and intelligent community members she had met during her initial visit.
Leigh was also living in New York when the coronavirus began to spread. Puerto Rico
had been on her radar since 2018, but the timing was not right to move because her start-up
company “fell apart”. Many of her friends and colleagues from the city had already relocated to
Puerto Rico, including some who were part of the CryptoMondays community there. In 2020,
she was setting up a crypto hedge fund and her tax attorney, who was providing advice on
Securities and Exchange Commission (SEC) compliance, recommended that she relocate to
Puerto Rico. Both the hedge fund and the coronavirus were catalysts for the move. She loved
living in New York, but when everything closed, it became a hard place to live.
“When coronavirus started hitting, and New York got hit pretty hard, pretty early, every
event was cancelled. Every project that was going to launch got put on hold. […] It was
crazy. Heart-breaking. A lot of people became sick. No one left their apartment. To live
in a city of eight million people and not see anybody for weeks was crazy. There are a lot
of companies that had offices that, suddenly were saying, ‘Just work from home. We’ll
give up the office.’ […] I think that April, May [2021] people were starting to think
about, ‘Where do you go?’ If you’re not tied to a city to work, if you’re paying

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outrageous rent, if there’s nowhere to eat, there’s no socialising, where’s the next place
you go?”
The pandemic was also the catalyst for many of Leigh’s tech industry contacts from New York,
San Francisco, and Los Angeles to relocate. During the winter of 2020-2021 more individuals
from the New York crypto scene relocated to the island. She explained, “There is a strong New
York contingent here. If you work in blockchain and crypto in New York, you have a basic
network here [in Puerto Rico] to start.” She further noted,
“There were a lot of great people doing work in blockchain and crypto figuring out,
‘Where is the next place?’ It was winter, so we were locked inside. It was freezing, so I
think a lot of people were like, ‘Where is the warm place? I want to go’. […] I’ve been
around really good, smart, accomplished people, but it’s amazing here, just everyone you
talk to has done something great.”
The increased flexibility and autonomy enabled by remote working created a collective shift in
mindset. Individuals were questioning their need to remain in an expensive city, state, or country
and considered alternative locations that offered an excellent quality of life, including a network
of likeminded, successful people working on interesting projects.
“There was a lot that just seemed appealing for me to come for better quality of life.
Things are a bit slower here, and island life, I think some of that is healthy. The New
York pace is quite a grind. The tech pace is quite a grind. While we’ve still been working
pretty hard, when you go outside it isn’t that kind of mad rat race that New York is. It’s
beautiful here, and there’s so much to do and explore. I think what I felt in early days San
Francisco is happening here. I think that there are a lot of good smart people working on
great projects or have done well in crypto. Whenever you meet people who tend to share

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a similar foundation of innovation, excitement for technology, being this global citizen or
participating in ‘How do we bring the world together? How do we do good things for
each other?’ then [you feel] just a sense of community; I think some of those are the
DNA of tech and blockchain crypto. I think it’s playing out real-time now that people are
thinking about, ‘Where do I want to be? Who do I want to be with?’ I don’t know that
utopia is the right word, but it feels a little bit like that, where people are thinking about,
‘I want to go where there are other people like me who are doing innovative work, but
also, I want to have an outdoor life. I want to be doing some good. I want to be around
other people that want to do some good’.”
Beyond the acceleration of digital nomadism brought about by the ability to work
remotely and location independently because of the pandemic, the strong blockchain migrant
networks in Puerto Rico, and San Juan specifically, helped shape individual migration decisions
and sustain migration flows to the island in 2020-2021. Gregory initially arrived for some
business meetings, but stayed for more than three months, unplanned.
“When I came, the plan was to be there for a week, and I stayed there 100 days.
Unquestionably, it was the community of people on so many levels. The highest, was just
the thought process, the mentality, everybody very libertarian, very apolitical. We’re on
the island, and in the crypto community it’s like let’s create a new world, let’s create new
systems.”
Following the BTC Miami conference in June 2021, Geoff McCabe, the CEO and co-
founder of Divi, a blockchain payment ecosystem, was with his team in Puerto Rico. They were
conducting meetings at an AirBnb villa, complete with a movie room and swimming pool, in the
San Juan metro area. On the outdoor terrace, midway through a meeting relating to the NFT

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space, Geoff remarked, “Taxes are less important compared to the community in Puerto Rico.”
According to Geoff, until 2020-2021, taxes used to be the reason for blockchain migrants
moving to Puerto Rico and, “Now, they’re becoming the second most important reason.”
Migrants supported by networks receive assistance that reduces the social, economic, and
emotional costs of migration (Light et al., 1993). By reducing the costs and risks associated with
migration and increasing the expected net returns, migrant networks represent a form of social
capital that “gives a powerful momentum to the migration process” (Massey & España, 1987, p.
733). Within the development of a strong migration network, formal organisations have emerged
to help new migrants organise their settlement in Puerto Rico and become familiar with the
island and its customs. Such organisations aid problem solving and offer resources to facilitate a
satisfactory personal and emotional adjustment (Light et al., 1993). PRelocate, an organisation
founded by two entrepreneurs who had previously moved to Puerto Rico, helps individuals and
businesses minimise the time and cost of migrating by sharing valuable information and
resources and assisting with any relevant paperwork (Figure 4.2). Several blockchain migrants
used PRelocate to help them with their relocation. Rusty, for example was pleased with their
consultation process, but also supplemented their service with inputs from his personal network.
“They have lists of lawyers and accountants that you can choose from, but they don’t say
that one of them is better than the other one. You decide. Do your own research. The way
that I do that is through friends. I like going to things and just meeting people. I like to
get advice on, ‘Who’s a good accountant? Who’s a good lawyer?’ The thing about
PRelocate, they said that they’ve never been rejected by the government and there’s a six
to nine month wait on the [tax decree] applications right now. You can see what a tax
disaster that would be if you applied for the thing and then it’s rejected for some reason.

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Some people just filed the wrong way or something and then now you owe taxes at the 37
percent rate instead of zero, or you hold them at 32 percent rate instead of zero or
something like that.”
Unlike Rusty, and in line with studies by Johnston et al. (2006) and Dekker and
Engbersen (2014), most blockchain migrants did their own research to complete the move. They
drew on their previous experiences when they relocated to new locations at various other times
in their lives. As Kyle noted, after conducting some online research,
“I just didn’t really see anything that I couldn’t manage myself. I moved several times for
my job before Mountain View as well and when I moved to Mountain View, I barely
knew anyone other than long-term blockchain contacts. When I moved to Costa Rica, I
knew like one person. I wasn’t really worried about moving to a new place. For me, it
was just doing a lot of preparation, a lot of research.”

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Figure 4.2. PR Relocate email 19 May 2021, noting the relocation deadline for the 2021 tax year
As in 2017-2018 when many crypto investors and entrepreneurs arrived on the island
during the crypto bull market, in 2020-2021 a new wave of migrants arrived during the next
crypto bull cycle. Pedro estimated that about 200 people arrived in 2017-2018, and of those,
about 150 left during 2018-2019 due to no longer making capital gains when the cryptocurrency
markets crashed in 2018. In February 2020, Pedro predicted a similar out migration pattern for
the end of the 2021 bull run:

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“[Bitcoin] from 10k to 100K. If that happens in 2020 [after the bitcoin halving], you’ll
see that influx here again. You’ll see a shit ton of people move here all over again for the
tax benefits. Then if next year, if the market corrects itself from 100K down to so say
25K, you’ll see, 65 percent of those people leave.”
Participants who arrived while the market was “tanking” in mid 2018, realised crypto winter was
approaching and had planned for it in their decision making for relocation to the island. Drew,
for example, recognised that the blockchain industry was not fully developed and that the crypto
market was likely to rebound due to market cycles, and so making the move in mid 2018 was a
“long-term play” while the blockchain industry matured. Those who stayed beyond the crypto
winter of 2018-2019 typically had a business model that enabled location-independent working.
Several participants explained that it is difficult to make money in Puerto Rico unless you are a
business owner. According to Ben, most people who remained were crypto “whales” (i.e.
investors with large crypto holdings) or they owned well-funded businesses. Participants in
Puerto Rico during crypto winter and through 2019 knew many people who left during this time.
Ghost highlighted several other reasons, aside from the crypto bear market, for people leaving
the island.
“Some people went broke. Some people showed up with $850,000 in the bank and over
the course of making some bad trades had to go get a job. Some people got frustrated
with the security situation, or the lights going off, or the potholes, or whatever. You have
to not like a place pretty bad if your tax savings can pay for your lifestyle. Then other
ones were people who would bring families down here and the moms wouldn’t feel safe.
They’d be afraid to go out. They’d live in Dorado, in a gated community, and they just
can’t get out of this whole thing. They’re stuck in Newbury, Peyton Place, and Stepford

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all rolled into one. A lot of the reverse migration that has happened, at least on the gringo
side, is because the wife comes down and she’s not happy. She’s like, ‘Look, I miss my
friends. I miss my coffee. I miss the things that I’m familiar with, and we have to leave’.”
State agents use laws and regulations to create the internal structural conditions for
specific types of migration which help determine whether migrants will prosper and stay or
leave. Most participants, and especially those interviewed prior to the 2020-2021 crypto bull run,
expressed that beyond the obvious tax advantages, they believed Brock Pierce’s presence
influenced the quantity of blockchain migrants arriving on the island. During a small gathering at
the Monastery, a former Masonic Temple turned hotel that Brock owned in Old San Juan,
someone estimated that about 80 percent of the blockchain migrants in Puerto Rico were on the
island because of Brock. Brock and the February 2018 New York Times article were the
catalysts for the start of blockchain-related migration in 2017-2018. Individuals migrated
primarily because of the incentives programmes as they wanted to save money on capital gains
made from the 2017-2018 crypto bull run and secondarily to join the growing blockchain
community on the island. Reverse migration occurred during crypto winter as living in Puerto
Rico no longer gave some individuals a financial advantage and migration thus slowed. Others
also left as they were dissatisfied with the quality of life. More general reasons for migrating
evolved over time. The subsequent bull run started in 2020 after the bitcoin halving and
continued through 2021. Increasing numbers of blockchain migrants were pulled to Puerto Rico
to take advantage of the more advanced blockchain infrastructure and community on the island
during this crypto bull run. Many were pushed from American towns and cities due to pandemic-
related lockdown rules and other regulations and could take advantage of being able to work
remotely. Moreover, concern over President Biden’s proposed tax policies also prompted

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individuals to escape the high-tax states of California and New York, especially. While the tax
decrees were a primary motivator for blockchain migration between 2017 and 2019 and they
were a major reason for post 2020 migration, in 2020-2021 other justifications emerged. For
many who arrived in 2021, migration was not on the agenda. They were visiting the island for
meetings or to visit friends. After being embraced by the sizable and vibrant blockchain
community and impressed by the combined eclectic brain power, talent, and unique capabilities
of individuals who had already relocated, they wanted to stay and plug into the existing
community to work on exciting and innovative projects. By 2021, the community had strong
network effects stemming from accelerating knowledge dynamics. The tax decrees became more
of a secondary concern for blockchain migrants.
Migrant Culture: “Similar Threads and Themes”
Jon commented on the heterogeneity of the blockchain migrant population. He explained
that while they might have “similar threads and themes”, they “couldn’t be any more different
than each other”. The one element tying all participants together, however, was they did not feel
obligated to conform to societal pressures and standards to think and behave in a particular way.
This nonconformity manifested itself in both public and private practices that embraced notions
of freedom, autonomy, and individual opportunity. Both Kyle and Ghost contrasted the
blockchain migrants with the “Midwest cubicle worker”, their term for the average person. The
migrants were quite out of the ordinary and might perhaps be considered the “black sheep” of
their hometown; but in Puerto Rico, they fit in. Ghost explained,
“The funny thing about people in crypto is you get a pretty big gaggle of odd ducks here,
you get a large group of people who were outliers, either emotionally, psychologically or
in their modalities of the way they think. What you see is a mix and amalgamation of free

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thinkers. Puerto Rico has become an attractive place for the kinds of bumblebees like us,
the people that are not quite like the other bumblebees; we’re a little bit different. You
find a good group of unique people here and you don’t have to go too far to find them.
They don’t necessarily fit into the Midwest cubical lifestyle, whatever that is; they’re
outliers.”
Many had lived in different locations abroad, pursued professional and intellectual
brilliance for its intrinsic value, and done extraordinary things with their lives. One participant
described the community as “an intellectual orgy”. As a family unit or as individuals, they
worked within and around the infrastructure that society provided, often contravening societal
norms and expectations, and achieving high levels of results that had the potential to seriously
impact the world. Monika observed,
“Most of the people I’ve met here have overcome more extraordinary things than most.
They’ve also achieved more things than most, earlier and more quickly than most people.
[…] You know you’re in the right room when you’re not the smartest person in the room.
That’s what really got me about it (living in Puerto Rico). I’m in the right room. I’m
eagerly scrambling to keep up with the brilliance around me. I love it. You can’t swing a
dead cat without finding someone real smart.”
The freedom mindset
These extraordinary “outliers” employed practices that aimed to achieve material
comfort, security, and financial freedom, while avoiding external and internal forms of
dependence, such as on formal employment or state institutions. They didn’t suffer from fear and
anxiety that could lead to “external dependence on institutions” by prompting them “to lean
towards the security of a pay check instead of the risks of freedom” (Fridman, 2014, p. 101).

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Many viewed creativity as the engine of the global economy and government as an obstacle to
self-realisation and entrepreneurship (Doherty, 2009). Aptly described by Benson and O’Reilly
(2018) as neoliberal subjects, these lifestyle migrants valued independence and operated on
interests, desires, and aspirations rather than rights and obligations (Read, 2009, p. 29). At a local
crypto event, one member of the community described methods for avoiding arrest for victimless
crimes to me and said he believed that many laws were merely suggestions. He went on to show
me a card about the Thick Red Line Project, an organisation whose mission was to prevent law
enforcement from enforcing victimless crimes (Figure 4.3).

Figure 4.3. Thick Red Line Project card
Many described themselves as libertarians who valued freedom from government and
individual freedom and choice and believed that “taxation is theft”, so naturally, they did not
appreciate rules that limited their autonomy. Puerto Rico was viewed as a definitively libertarian
environment primarily due to the island’s lax enforcement of rules, its flexible stance on various
issues such as home schooling or drinking alcohol on the beach, and the attitudes of other
migrants who had relocated. Ghost noted, “It’s a place that is very libertarian, cops don’t really

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give a shit what you’re doing so long as you’re not hurting someone and they really don’t want
to write you a ticket. They really don’t have time and they just can’t be bothered.” Similarly,
Brian explained, “Puerto Rico has a really great sandbox, not just for children and their
education, but for everybody here because it’s more flexible; the legal framework and
enforcement and other things are quite relaxed in many ways.” CryptoMondays featured many
speakers who were [somewhat] libertarian in their outlook. On March 29, 2021, for example,
Yaron Brook from the Ayn Rand Institute spoke at the meet-up about objectivism, a philosophy
in part developed by the Russian-born novelist and philosopher Ayn Rand, whose admirers value
individuality and personal freedom, and believe in capitalism via a free market. Indeed, Yaron
Brook and his colleague Don Watkins published Free Market Revolution: How Ayn Rand’s
Ideas Can End Big Government in 2012 and they defended the pursuit of wealth and profit to
end the growth of government and argued that productivity and rational selfishness could enrich
human life and aid human flourishing.
Money was seen by many migrants as the means by which individuals could enjoy
greater freedom, choice, and more time (Smith, 2006). Those who had more financial freedom
were typically traders, long-term crypto investors, or serial entrepreneurs. Some had a corporate
background, having previously worked on Wall Street or for a multinational technology
company, and they applied the money and experience they had gained elsewhere, e.g. working
on high-value projects or in investment banking, to their individual endeavours in Puerto Rico.
These individuals, like Kyle who had previously worked at IBM in technology consulting, were
typically traders (of crypto and other assets) and angel investors. Serial entrepreneurs, like Brock
and BitsAndMore, had been involved in the cryptocurrency and blockchain space for many
years. Working together, they started a bitcoin mining operation in 2012 and in 2013 joined the

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board of directors for Mastercoin, and rebranded as Omni, which was the platform used for
launching Tether, the largest stablecoin by market capitalisation. Brock and BitsAndMore also
made a substantial investment in the Ethereum token sale in 2014. Such entrepreneurs and
investors who had entered the blockchain space pre 2014 were generally extremely wealthy.
While some migrants were making their money work for them, not all migrants were “financially
free”. A large number were focusing on building their business[es] and for those who had Act 20
or Act 60, the freedom from high taxation enabled them to re-inject the capital they saved into
their companies to enable faster scalability and growth. Jon explained,
“The more money you make, the more you get taxed which also is very suffocating for
people to do big things. The leap from being a successful small business to an Amazon is
where we’re losing a lot of people. […] Every dollar you make in that, call it $100,000 to
$1 million income range, you’re going to get taxed about 40 percent. You’re basically
only stacking half a dollar every time you make one onto your capital reserves. From
that, you need to pay yourself, pay your employees, pay CapEx and plan for their future
and plan for potential loss when you try to do something creative or different with your
business and you make a mistake. […] You can take half of a small pie or you can take a
fraction of a giant pie and actually be in a better position from a tax standpoint. If you
have a million dollars and you take half of it, you have a half of a million dollars. If you
take 10 percent of a billion, you’re in a better position. Government doesn’t need to be
the thing that subsidises everything… let the free market be a free market. I’ve always
been looking for ways that I could help my business flourish. Being in a healthier tax
environment is the end-all-be-all number one way to get that going.”

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Many migrants believed big government was destructive, and that it limited production,
freedom, and innovation. They worked hard as individuals to create a fulfilling life for
themselves, despite institutional forces. While most migrants were in favour of small government
and laissez-faire capitalism, a small number were more liberal in their views. Monika described
that she was applying for Act 60 to avoid having to deal with the huge daunting task of tracking
and reporting every crypto trade, but she felt conflicted about her relative privilege and affluence
in Puerto Rico and not paying capital gains taxes. She further explained,
“I, personally, really love the Biden tax plan. I’m so glad that people are saying he’s like
Franklin D. Roosevelt. I’ve been waiting for another FDR for a long time and he’s like 20
years too late in my opinion. It really is ironic; it’s a little heart-breaking. It’s put me in
quite a crisis of conscience and a conundrum that I don’t know what to do with the fact
that I love this tax plan and as soon as it comes under the political threshold, I’d take this
act to just absolve myself of the responsibility of participating in it. I think I should be
paying those taxes, but I also have a real problem with certain parts of our tax code and
where it goes. For example, the military industrial complex; I have a real problem with
that. People have made some good counter examples and counter points to me saying,
‘Well, we’d be owned by China right now if we didn’t have a really strong military.’ I
think there might be something to that. I oppose the military; in general, I oppose
violence. I think there’s also this economic violence that I’m perpetuating by not
participating in paying taxes. One of the things I’ve come up with, this year I’m going to
try to formulise them potentially; even pitch to our community and see who wants to
participate this way, because I think there might be some people that want to think this
through. But I’m like, ‘Okay, if I no longer pay U.S. taxes, but of all the states and

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territories, Puerto Rico’s the poorest, then it makes sense that I can become an Act 60,
siphon my tax burden and 40 percent goes to military.’ I will keep that 40 percent gladly.
I have no need to find another military to give it to. But the other 60 percent and I haven’t
dug into it exactly, but if I believe that those things should’ve been paid in the United
States then I should probably figure out a way to pay them here in Puerto Rico. I think I
need to do something with my 60 percent tax burden that I don’t have any more and see
what to funnel it into, specifically on the island because I think that that alone could be a
counter narrative to this colonising effect where, yes I’m avoiding taxes. I’m evading
taxes in the United States. I’m siphoning my tax burden directly to this poorest nation or
this poorest territory. I think that might square up my conscience.”
As well as considering the impact of taxation on their lives and society, blockchain
migrants commented on the financial freedom that they had created for themselves that afforded
them more time to focus on the pursuit of desirable activities. Kyle explained how he was able to
get out of the nine-to-five grind and improve his quality of life by having more time to spend
with friends and family.
“In general, [what] I enjoy most about life, it’s just having the freedom to spend time
with friends and family. That might be financial freedom, that might be psychological
freedom; freedom from anxiety, freedom from all these other terrible afflictions from
mental health that afflict people today. The greatest I think is time, to be able to spend
that time with your loved ones and people you care about. […] As you know, just from
my background, I’ve been very fortunate. I have some degree of financial independence
now. That’s been a surprising benefit that I never thought about, I have more time to
spend with family. For many other people, if you’re confined in an office job, nine to

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five, you have a vacation for maybe two weeks out of the year; that’s the average. That’s
what you’d expect a normal work-life balance to be or lifestyle to be, but in the greater
scheme of things, it’s sad because if you think about it, so little of your time is your own.
The time that is your own, you’re always tired or you’re waiting for vacation. Even now,
a lot of vacations aren’t real vacations. Your work is still waiting for you when you come
back to make up for it.”
Migrants generally operated around normative conceptualisations of time. Time was seen
mainly as a tool for the organisation of work and thus the work-life balance and blockchain
migrants realised that they needed to gain greater control over time in order to increase their
flexibility and freedom in life (Roberts, 2008). Many had discovered enjoyable and lucrative
ways to earn money, and so work and life were more harmonised and the integration of work and
non-work activities was commonplace. Ad-hoc and scheduled business meetings often occurred
at parties and events. Money could always be earned to purchase more material possessions, but
as a scarce resource, time was used flexibly and efficiently, which facilitated freedom. Some,
like Kyle, had financial freedom, which afforded them more time to spend with loved ones and
partake in other satisfying activities, and others focused less on materialistic values and goals
and instead restructured their lives around time. Taken forward in life from her days as a
burgeoning artist, Monika explained,
“My whole goal in the economy was to give as little of my time away, and need as little
money back, and just be able to get by, so that I could get all of my time back. […] This
could be the last moment I have. I could just die of an aneurysm in five minutes. I have
no idea; none of us do. We don’t realise how precious that is.”

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Migrants exhibited high levels of life satisfaction through their optimism, high mental
and physical well-being, and get-up-and-go attitude, and had structured their lives in such a way
that gave them sufficient time, mental energy, and control to enjoy a variety of fulfilling
activities (Joseph Sirgy & Wu, 2009). This freedom to manage time underscored how the
migrants were active agents in their own lives. Monika continued,
“Now I can be more selective, and so this freedom mentality around time has stuck with
me now. I always think about what I’m giving up in terms of either, ‘Do you want me to
get up at times I don’t want to be awake? Do I want to be there? Are you asking me to
work 40 hours a week when I wouldn’t want to? What restrictions are on my life in
exchange for this money thing?’ I’m much clearer about how the reward system works
and being here, I’ve gotten involved in a dozen companies, projects, initiatives, and
things that people are starting out. They’re just start-ups that I’m so excited about. I’m
either advising the company, or I’m helping to found the company, or I’m a vendor to the
company, or I’m hanging out and trying to help them in whatever I can. I’m a connector
for them, but it’s just a beautiful thing to do with my time. I don’t mind trading my time
for things that might have this new, infinite growth that goes in a new direction. It doesn’t
necessarily mean money to me, or money to me right away. That’s what I think I really
brought back with this time perspective. It’s like, ‘How little could I live on?
But what do I have? All day to myself or to do my own thing.’ That’s just so much in my
blood now.”
Migrants had learned how to manoeuvre their lives to achieve the flexibility to devote
their time to activities that they found meaningful. Money was a motivator for many to achieve
freedom, but others, like Monika, had learned to live on less because they prioritised time,

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freedom, and personal growth to follow a career and life path of their choosing. In addition to
financial freedom, the concept of free time, and freedom from obligations as defined by others,
was a state of mind (Shir-Wise, 2019).
Hacker culture and risk-taking behaviour
Most migrants were not expert programmers or socially awkward as per the hacker
stereotype, but many embodied the hacker ethic. Participants’ attitudes and values aligned with
hacker culture, with a scepticism towards bureaucracy and a particular view of liberty deemed
necessary for critical thinking and self-development (Levy, 2010; Coleman, 2013). As Leigh
explained, “I think some of the nature of tech; it’s somewhat anti-establishment or anti-
corporate. Naturally, people that are part of the community are drawn to a little bit of that
socialising, rule breaking, wanting to do good. There’s just these themes that, naturally, I think,
have been the foundation of the tech industry.” Centralised bureaucracies were viewed as flawed
systems that invoke arbitrary rules to consolidate power (Levy, 2010). In line with this thinking,
many blockchain migrants enjoyed identifying and exploiting technicalities and loopholes within
rules and systems or pushed boundaries. As Levy (2010) points out, according to the hacker
ethic, people, laws, and physical barriers that prevent individuals from improving systems are
resented. Such “rules that prevent you from taking matters […] into your own hands are too
ridiculous to even consider abiding by” (p. 28). This mind-set is in line with start-up
entrepreneurship, where founders have a desire for innovation, experimentation, and creative
problem-solving, which stems from Silicon Valley culture (Rayner, 2018). Alexander told me
about a group of migrants who were exploring alternative passports: “It’s like a freedom thing.
For some people, they’re libertarians, so the whole alternative passport option angle fits in with
that well, because they’re worried about various things. Like if all hell breaks loose in America

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or there’s civil war or some shit happens, or they want to have other options.” This group banded
together to buy a package deal on passports from St Kitts. For access to the European Union,
Portugal was another consideration. There, investors must put money into either real estate (at
least €350,000 for property over 30 years old or €500,000 for newer property) or in an equity
fund regulated by the Portuguese government (€350,000) and they only need to spend seven days
annually in the country over a five-year period. He explained, “It’s not that it’s better than other
European countries, I think they just have a clear and easier path to get the passport. I don’t
know all the details but that’s my understanding. I hear it mentioned all the time. I don’t hear any
other places mentioned.” Some migrants also hacked the COVID-19 mask mandate. They wore
mesh masks that offered little protection but were more comfortable for the wearer than regular
masks as the mesh made it easier to breathe and yet still complied with the rules. Beyond
manoeuvring within boundaries set by the rules, such as identifying and benefiting from legal tax
loopholes or acquiring alternative passports, blockchain migrants also found ways to bend or
“hack” the rules of systems that they did not necessarily agree with.
During the COVID-19 pandemic, the local Puerto Rican government required people to
wear facemasks in public and implemented a curfew, which at one time began as early as 7pm.
With restaurants closing early, and bars and nightclubs forced to close altogether, blockchain
migrants organised their own gatherings at AirBnbs or private residences, avoiding the
constraints of the curfew. On New Year’s Eve of 2020-2021, for example, when the curfew was
9pm, an expatriate friend of the blockchain community paid to fly in a DJ from Honduras to play
with an expatriate DJ at an AirBnb that was rented by an off-island associate for the holidays.
The party was a regular New Year’s party, including fireworks set off from the roof. Similarly,
the migrants regularly rented wood cabins near a remote lake for weekend get togethers to enjoy

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what can be described as a summer camp for adults complete with games, music, and
kayaking/paddle boarding (Figure 4.4). The weekends were an escape from the new rules,
norms, and regulations associated with COVID-19 enforced more stringently in the larger towns
and cities. Many migrants resented their freedoms being removed and pushed back at the strict
legal regimes put in place. They were willing to risk exposure to the virus. However, many
people in the blockchain community who attended parties and gatherings caught COVID-19 at
super-spreader events in late 2020. Rather than leaving individuals to recover on their own, the
community rallied together to help them, delivering groceries, supplements, and homemade soup
to the sick. There were even separate Thanksgiving dinner parties: one for those with COVID-19
and another for those who did not have it, or who had caught it previously and recovered. The
concentration of migrants on the island and especially in the San Juan metro area, facilitated the
development of a tight family-like community that provided members with enjoyment at parties
and events and the support they needed, especially during the pandemic and other difficult times.
Leigh explained, “We’re all untethered. There are a lot of single people who don’t have families
here. I think very quickly we become family. There’s a lot of beauty in that.” Absence of or lack
of concern about contracting the virus perhaps was related to the fact that the blockchain migrant
population generally comprised younger single people, and consequently they did not interact
with individuals considered at greatest risk for severe illness from COVID-19, such as the
elderly.

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Figure 4.4. Lakeside cabins where migrants would hold social events in 2020-2021
The community’s norms and values did not encourage compliance with COVID safety
measures in 2020 and other broader societal pressures; rather, per the hacker ethos, they
permitted members to be more mischievous in relation to systems or structures they might not
agree with. Some believed that the pandemic was a farse and a crime against humanity. One
participant was concerned about patents on certain coronaviruses - “how can you patent
something that is supposedly from nature?” - and the subsequent trillions of dollars being made
by big pharma. Some community members did their best to avoid the vaccine, because they
believed that it could be linked to infertility or other health issues. Rule-breaking behaviour
sometimes prompted hostile reactions from others. Venue managers at several meetups
threatened to close events, since most attendees were not wearing masks. At least one venue was
fined when attendees did not follow the executive orders. One event organiser sometimes posted
messages to associated WhatsApp and Telegram groups appealing to participants to abide by the

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rules to mitigate the risk of losing the venue for the event. To avoid potential fines for holding an
overcrowded outdoor gathering at venues popular with expatriates, such as those in the Condado
area or on Calle Loiza, CryptoMondays was held in La Perla in February 2021. La Perla is a
historical slum neighbourhood outside the walled city of Old San Juan with a reputation for
being a violent and dangerous place that runs on the drug trade. The police rarely visit the area,
which has its own informal laws (e.g. don’t take photos), and the government has little influence
there. A boxing and mixed martial arts (MMA) gym in the self-reliant and semi-independent area
was a perfect location for the CryptoMondays crowd who wanted to minimise the impact of
COVID-related regulations on their event. The gym owner lived in La Perla and had close
positive relationships with both the local La Perla residents and the expatriate community.
CryptoMondays was only held in La Perla this one time, but using the location illustrates the
ingenuity and problem-solving skills of the migrants when quite strict COVID regulations were
still in place and suitable meet-up venues were difficult to find.
In September 2021, the migrants who had chosen not to be vaccinated became more
frustrated when Governor Pedro Pierluisi announced a new executive order requiring all
commercial establishments to enforce vaccine mandates on not only their employees, but their
customers as well; else operate at 50 percent capacity. At this time, Brock hosted an event for
Roundtable, “a decentralised media network focused on news, politics, and
cryptocurrency/blockchain” (Business Wire, 2021). It featured an exclusive roundtable
discussion with the Pandemic Health Alliance (PHA), several doctors, a psychologist, and a
statistician who discussed the science and data relating to COVID-19 vaccines and treatments.
The panel comprised prominent experts such as Dr. Ryan Cole, Dr. Robert Malone, and Dr.
Brian Tyson who are known for their outspoken voices on the topic. The audience included

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many blockchain migrants and prominent individuals working in health, government, and
business. The expert panel, who had perspectives distinct from the mainstream narrative, spoke
of many “well-designed” studies (as opposed to studies that they described as “designed to fail”)
and their own field experience of treating patients with COVID-19. They recommended early
treatment and described the reliance on vaccines as a “whack-a-mole” approach as vaccines are
only effective for specific variants, and thus vaccination is a never-ending endeavour. Given the
freedom mindset of the blockchain migrants, it’s not surprising that Brock and Roundtable
offered a platform for suppressed voices, especially as migrants were generally not afraid to
voice controversial viewpoints that contradicted or critiqued the mainstream. For many mobile
blockchain migrants, who hacked systems they disagreed with, and especially those who
prioritised the principle of freedom, being able to travel and participate in society in a post-
pandemic world without COVID tests and vaccines was a huge concern.
Hacker culture was embodied and represented through the real-life social actions of the
blockchain migrants, who demonstrated a creative and rule-breaking ethos, and a risk-taking
attitude. The risk-taking aspect of their behaviour, especially with regards to bending and
breaking the rules, may be because most migrants were entrepreneurs. Entrepreneurs tend to take
strategic actions in uncertain environments and risk taking is deemed a fundamental component
to their success (Nestel & Trost, 2016). The management of danger associated with certain
activities, relationships, or behaviours allows the level of acceptable risk to be determined, and
while certain behaviours may result in harmful or dangerous outcomes, they also have the
potential for positive results (Giddens, 1990; Allah & Nakhaie, 2011). The migrants accepted the
risk of contracting COVID-19 to attend various events and parties during the pandemic, which
helped them develop new relationships, friendships, and connections. Some scholars have noted

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that entrepreneurs are generally more positive in their outlook and therefore more likely to view
certain situations as opportunities. By contrast, non-entrepreneurs may not share the same
attitude, so they act more cautiously (Palich & Ray Bagby, 1995; Brockhaus, 2000). As Brock
explained in relation to the pandemic, “I’m a very positive person, and so I never had any of the
depression or mental health issues that have impacted so many.” Thus, optimism may influence
risk perception and entrepreneurs may view a particular behaviour as less risky due to their
positive outlook compared to a non-entrepreneur. As many migrants were entrepreneurs that
embraced a hacker ethic and libertarian streak, they saw opportunities to create their own fun
without relying on hospitality establishments that were forced to close by the curfew, and they
risked catching or spreading the virus. The courage to bend the rules, and open mindedness and
adaptability to work within and around challenging and evolving circumstances, such as the
pandemic, underscored how many migrants were willing to embrace uncertainty and risk.
Local media access may also explain some of the rule-breaking behaviour. Local updates
pertaining to the pandemic were often shared via WhatsApp and other social media channels, but
traditional local news outlets were more likely to be ignored or followed less frequently, since
many blockchain migrants could not speak fluent Spanish. Mass media influences public
perception and social issues, and people tend to draw on the symbolic meanings and perspectives
generated by entertainment and news sources in social situations (Altheide, 2017). Support for
coronavirus-related policies that increased social control, such as curfews, limits on social
gatherings, and mask mandates could be achieved by instilling and sustaining fear in the
populace through use of mass media, as political leaders often use fear to successfully “get
power, maintain control, and exercise force to support one’s goals” (Altheide, 2017, p. 22). Since
migrants consumed much less local content than the Puerto Rican population, they were perhaps

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less afraid of COVID-19 compared to the locals and were not as influenced by the ideologies
promoted by the media.
Many migrants who arrived before 2020 were not very concerned about the virus. If they
arrived in 2020, they were often escaping strict COVID-related regulations in their previous
towns or cities. Those who had arrived in 2019 or earlier usually consumed very little local
media about the virus due to the language barrier. The migrants who arrived in 2021 were
typically risk averse. They feared the virus either because of life experience in their previous
location or they felt particularly at risk of contracting the infection. One member of the
community told me that he probably would not have attended the event we were at, if he was
unvaccinated. Monika too, who arrived on the island in April 2021, tried to reduce her risk of
becoming infected by being vaccinated. She knew she was going to be joining a group with
different views compared to her own, as living in New York, the epicentre of the earliest
outbreaks, made her fear the pandemic. Monika explained,
“I knew I was going to have to be shelving that [perspective] and trading it off for being
around people that talk about other things that had more to do with my work life, and
opportunities to make and perpetuate businesses, that I wanted to hopefully pick up and
get back going after taking a year to just stay home […] I went from 2020, a year of
nothing happening. I completely paused. I just thought if we can all just follow the rules
for two God damn weeks. […] I just kept being like, ‘I’m just going to keep doing the
right thing until we get this out of the way.’ It did not come out of the way. Finally, I was
like, ‘If you can’t beat them, join them, and get your vaccinations and keep going’”
The divergent views and behaviours in relation to the virus illustrate of how individuals
organise in response to risk. Risks affect quality of life and are typically distributed unevenly in a

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population. Acceptable risk is predicated on a value judgement relating to the level of calculated
risk that individuals are willing to accept (Beck, 1992). Some community members, such as
Monika, may adjust their behaviour in exchange for meaningful participation despite the risks.
Others are more risk averse, such as Alexander, who decided against attending most social
events and activities during the pandemic.
Californian ideology
Alexander described the migrants as falling on a spectrum between “single guy computer
nerds” to “Burning Man party people”, and many situated on the outgoing side of the continuum
had an unconventional outlook on life. Pedro noted,
“I’ve met more people in the festival scene being in the crypto space than I have in my
entire life. It seems like the hippies that are in the festivals get along with the crypto guys
because of the libertarian style and the mindset. A lot of the burners, the Burning Man
people; they bleed over to each other.”
Members of Brock Pierce’s inner circle and a handful of other migrants had attended
Burning Man Festival (or expressed a strong desire to attend). Known as “burners”, participants
at Burning Man partake in rituals such as burning the Man, which is a large wooden effigy, and
“traditions such as self-expressive participation, and affecting a remarkably strong civic
engagement in their temporary city” (Kozinets, 2002, p. 21). Burning Man runs on ten principles,
including civic responsibility, inclusivity, and radical self-reliance (Burning Man, 2018), and
blockchain migrants who had attended lived their lives by these ideologies. Like public
blockchains, burners espouse decentralist values as they must use their own resources to survive
at the festival, rather than rely on a centralised authority. Each person is also in charge of their
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required: “No one is in charge and yet everyone is in charge” (Leising, 2020). Brock commented
on the overlap in values between burners and many blockchain enthusiasts.
“Burning Man is the greatest experiment in decentralised governance and living.
Blockchain is the technology bringing decentralised governance and systems, and so I
saw very real similarities in terms of, one is the analogue, one is the digital. I introduced
this not so well-known event that was Burning Man to people and tons and tons of people
started to come. They started to be overlapped, and I gave a lot of speeches about it. What
I personally learned from it is principles. The ten principles of Burning Man; that’s about
inclusivity. Blockchain is building systems of inclusivity. It’s about participation, getting
involved. Be the change you wish to see in the world. The idea of gifting and taking care
of others and being creative. It’s the biggest art festival in the world. Just creativity off
the charts and an experiment where there is no money, and everything is about gifting.
No VIP; everything is open, it’s inclusive. Everybody is invited; everyone’s welcome.
It’s a social experiment that shows what the world could be like if the world had
developed differently. The idea isn’t to turn the world into Burning Man. The idea is
social experiments to understand ideas. You go, ‘Oh, then maybe I want to do more of
this.’ I took that concept, and I’ve brought it into my daily life. Burning Man is largely to
credit for it. Had I not learned to do that--almost like standing in line for a coffee, buying
a coffee for the person behind you but not even saying anything and then you just--
you’ve already left. It’s random acts of kindness. These are just the sort of things I
wouldn’t learn in the analogue world because people are not that nice and caring. It
opened my eyes up to an alternative reality.”

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At the festival, where money and commerce are outlawed, there have been several camps
devoted to decentralist principles, including Camp Dogecoin (which emerged in 2014) and Camp
Decentral (which appeared in 2017) (Figure 4.5). These camps have involved many of the top
players in the crypto space, such as Griff Green, who founded Camp Decentral and was a
fundamental figure in resolving the aftermath of the Ethereum Decentralised Autonomous
Organisation (DAO) hack in 2016 (Leising, 2020). At Burning Man, Beck realised that he did
not need to conform to social influence in his day-to-day life. This liberating feeling likely
stemmed from the “alternative reality” that burners experience at the festival. Beck also noted
that Puerto Rico attracted individuals with a similar mindset.
“I would say coming back from Burning Man really opened up my eyes because I felt
that I don’t have to live in any way that society forced on me. [It was] one of the
impetuses for me to leave the big path, quit corporate, and embrace uncertainty. Really, I
don’t want to minimise that. It really took a special type of people to move to Puerto
Rico. I’m not saying just me. I’m saying a flock of people.”

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Figure 4.5. Camp Decentral at Burning Man, 2018 (Breezy, 2018)
Akin to the hippie movement in San Francisco in the 1960s, which rejected the traditions
of mainstream society, Burning Man also originated in San Francisco, in 1986 before moving to
the Black Rock Desert in Nevada in 1990.
6
Over time, the festival became popular with more
Silicon Valley entrepreneurs and business leaders. Many also contribute to the social art projects
and installations at the festival. One participant noted that many in the tech community at
Burning Man used psychedelics as a practical tool for complex problem solving and innovation.
“There’s a certain cross-section sub-mix of burners that are smart, innovative, and techie.
There’s definitely Burning Man that sprung up to be more of a tech billionaire party
made up of all the geniuses in the tech space. I guarantee you that more than 100
conversations happen at Burning Man that lead to a multi-billion dollar deal afterward

6
Other countercultural groups from the blockchain/crypto space also gather at the anarchist conference,
Anarchapulco, in Mexico, which has featured crypto/decentralised speakers such as Roger Ver and Vít Jedlička.

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out of really smart people in the Burning Man community. When you do psychotropics,
you feel connected with everyone and everything. If I know that you’re on just as much
acid as I am, then we’re going to have a great night together and at four o’clock in the
morning, we’re both spun out and we’re laying there and we’re just cuddling and we’re
talking and we’re like, ‘Hey, we should start a business to fix yaddi yaddi yadda.’ ‘Yes,
that’s awesome.’ Then the next day, we sit down and talk about it. It leads to connection;
it leads to creativity 100 percent. Seeing colours that you didn’t see before. Seeing
patterns that spark something in your brain until you can solve the problem.”
Personal computers evolved from the sixties counterculture as they were seen to facilitate
the freeing of minds and information, and many early hippies believed that technological
progress would facilitate the manifestation of their libertarian ideals in reality (Barbrook and
Cameron, 2001). Indeed, Timothy Leary, a Harvard professor at the Center for Research in
Personality, was famous for advocating the emerging counterculture to “turn on, tune in, drop
out” through the use of a small technological invention called lysergic acid diethylamide (LSD)
(Leary, 1965). Analogous to the philosophical ponderings of John Perry Barlow, Timothy Leary,
Stewart Brand, and other hippies of the 1960s counterculture and beyond, such out-of-the-box
thinking among the community in Puerto Rico stemmed from embracing consciousness culture
and using technology, including social media, blockchain, and psychedelics, as tools to build
companies and communities.
Like those involved in the hippie movement, Burning Man attendees embody California’s
“creative anarchy” (Davis, 2015, p. 177). This fusion of bohemianism and Silicon Valley techno-
utopianism is described by Barbrook and Cameron (2001) as the “Californian Ideology”. These
Californian ideologues “preach an anti-statist gospel of hi-tech libertarianism: a bizarre mish-

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mash of hippie anarchism and economic liberalism beefed up with lots of technological
determinism” (Barbrook & Cameron, 2001, p. 373). Many of the blockchain migrants in Puerto
Rico embraced these principles. Alternative governance and institutional design models using
blockchain technology were common experiments, innovations, and applications imagined and
developed by blockchain enthusiasts with crypto-utopian visions of the future. Comparable to the
hippie movement, which formed the roots of the modern cyberrevolution and “provided the
philosophical foundations of not only the leaderless internet but also the entire personal-
computer revolution”, as personal computers were seen to facilitate the freeing of minds and
information; many blockchain enthusiasts, and especially those in Puerto Rico, scorned
centralised authority (Brand, 1995). They didn’t easily subscribe to top-down control, had
broken free of the regimented and tightly structured social condition, and had embraced
“weirdness” and “creativity” (Salsbury, 1991). Like hippies and burners, they were “adventurous
yet resourceful” (Leising, 2020). Some of the most accomplished blockchain migrants were also
directly comparable to many Silicon Valley visionaries, burners, and hippies of the
countercultural 1960s in terms of drug taking, in that they also liked to consume “weird drugs”
(Davis, 2015). Occasionally they used psychedelics such as psilocybin mushrooms, LSD, and
ayahuasca for creative problem solving, healing, and spiritual development. In parallel to Ben’s
account of his Burning Man experience, many who take such substances report a freedom from
social restrictions (Fishbein & Pease, 1996). In Puerto Rico, psychedelics were taken in casual
settings, such as parties, events, and weekends away as well as in more formal ceremonial
settings. One participant explained,
“There’s definitely an abundance of hallucinogens here. Everything from Taíno medicine
of ayahuasca, deep in the forest, and you sit for a day with the ancient Taíno people and

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the elders and they walk you shamanisticly on a great journey, or you sit here and
microdose mushrooms, which are being touted as a new PTSD cure. Yes, there is a lot of
psychedelic use. It’s really cool to take some psychedelics and go on an adventure and
then go to the biobay at night.”
7

Among the blockchain migrants who took drugs recreationally, it was more common to take
natural hallucinogens or other forms of plant medicine than designer drugs. Ghost commented on
the drug use that was prevalent among some blockchain migrants.
“I would say that there’s an organic movement here that people are imbibing things that
are natural as opposed to unnatural. What I have seen is people using substances that are
mind-expanding or that are emotionally helping to rebuild people. I’ve seen a lot of
natural medicine in the terms of healing. What I’ve not seen is a lot of abuse of narcotics
in the typical sense of people being so blown out on coke, they’re falling off the edge of
something. I have seen it as a spiritual journey or as an emotional rebirth or healing, but I
haven’t seen it in the sense of people grinding really hard on something to destroy
themselves or others.”
In addition to the spiritual benefits, many viewed psychedelics as performance-enhancing
supplements. Indeed, Steve Jobs a child of the counterculture and avid reader of the Whole Earth
Catalog, which he described as one of the bibles of his generation, explained in his biography
that LSD was a profound experience and one of the most important things of his life (Stanford,
2005; Isaacson, 2011). When Jobs and other successful individuals began recommending the use
of psychedelics for enhancing creativity and problem solving, it became more acceptable for

7
Puerto Rico is home to three of the five bioluminescent bays in the world. Mosquito Bay on the island of Vieques,
off the eastern coast of the main island, is the brightest and was recognised by the Guinness World Record in 2006
(Guinness World Records, 2006).

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others in high-pressure and innovative environments to do the same (Kotler & Wheal, 2017).
Author and investor Tim Ferriss noted, “The billionaires I know, almost without exception, use
hallucinogens on a regular basis. These are people who are trying to be very disruptive. They
look at problems in the world and they try to ask entirely new questions” (Kotler & Wheal,
2017). Such disruptive individuals were clearly the target demographic for Apple’s Think
Different campaign in the mid 1990s. They thought differently than the mainstream and thus
were able to become centres of creativity and innovation. As the script from Apple’s 1997
commercial states:
“Here’s to the crazy ones. The misfits. The rebels. The troublemakers. The round pegs in
the square holes. The ones who see things differently. They’re not fond of rules, and they
have no respect for the status quo. You can quote them, disagree with them, glorify and
vilify them. About the only thing you can’t do is ignore them because they change things.
They push the human race forward. And while some may see them as crazy, we see
genius. Because the people who are crazy enough to think they can change the world, are
the ones who do.”
This distinct difference in thought processes compared to what may be considered the
average individual is echoed in “This is the Island of Misfit Toys”, a phrase I regularly heard
when talking to blockchain migrants in 2021, when many people were relocating to the island.
Leigh was working in marketing for Apple in the Bay Area during the dot-com years and worked
on the Think Different campaign, just after Steve Jobs returned. At the time, they were figuring
out how to market to people online. She explained that many of the blockchain migrants in
Puerto Rico were the kinds of rebels and troublemakers depicted in the Apple campaign. They
often pursued projects and approached life in a different way to what was dominant in the

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mainstream and traditional modes of thinking. She also explained that much of the energy and
excitement that she was seeing in Puerto Rico was identical to what she saw in Silicon Valley
during the mid 1990s.
“Being in the Bay Area, a lot of innovative thinkers, a really just exciting, exuberant
time. I see a lot in the time that I was in San Francisco here in Puerto Rico. In San
Francisco, there was a natural, open-mind, liberal, creative, no-rules, play in the sandbox-
- Move fast, break things is the mantra. The late ‘90s was an exciting time because people
were just wanting to build cool shit. It wasn’t about evaluation or an IPO or making
millions of dollars. It was, ‘I want to do really cool work,’ or, ‘I want to be a leader, the
innovator in this space.’ Just to be around all of these, and these were friends, these were
people I worked with-- While what I was doing in San Francisco or New York felt very
specific to those locations, what was happening with blockchain and crypto was global. It
was exciting. You were working with people all over the world. There were events all
over the world. Quickly, this experience that we had in the heyday of San Francisco was
happening on a global scale. It wasn’t just in New York (where Leigh resided when she
started working in the crypto space). I think that some of that excitement of the global
scale has come to Puerto Rico. It’s been this melding of people and projects here.”
The Californian ideology was replicated, embodied, and embraced by the blockchain
migrants in Puerto Rico. The parallels to the neoliberalism of Silicon Valley that stemmed from
the hippie movement and the development of personal computers, and the internet, were striking.
In both instances, brilliant and rebellious individuals came together to develop unconventional,
innovative technological solutions that challenged the status quo.

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Population Density, Local Networks, and Community Integration
Unlike the tech explosions in Silicon Valley and New York, Puerto Rico had a higher
concentration of people working in blockchain-related careers, especially in the San Juan metro
area. Many who arrived in 2020-2021 had overlapping and similar professional backgrounds and
networks – mostly from the Bay Area or New York – and already knew many “brilliant” people
who had relocated to Puerto Rico. They reported that it was easier to hit the ground running on
new projects compared to mainland hi-tech hubs, since they had built a level of prior trust with
tech industry players before moving.
Residential location was a key decision for many migrants. The majority of blockchain
migrants lived in San Juan. Although, some migrants with young families lived in the
surrounding area in places such as Toa Baja or Caguas, a 30-minute drive from San Juan, rather
than in the busy city. Other families and older community members lived in Dorado or Palmas
del Mar and those who enjoyed surfing, or a slower pace of life, lived in Rincón (Figure 4.6).

Figure 4.6. Popular places for blockchain migrants (and other expatriates) to live
One of the big draws for Brian in Toa Baja was the family-friendly neighbourhood that provided
a supportive environment for his children to learn and develop. His wife was a trained teacher

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and she was running a free preschool cooperative for four-year olds in the area. Nico decided to
live in Old San Juan to be close to Condado where The Robinson School, a high-performing
private school, was located. His family also wanted to integrate with the local community, so in
Old San Juan they felt they could enjoy both the American and local ways of living. They also
considered Dorado, but felt the gated communities were too segregated. Jennifer was older than
the typical blockchain migrant and she chose to live in a double-gated community in Dorado
following the recommendation of a Puerto Rican real estate agent. She did not want to live in the
city and her primary concern was safety as a single woman. Other migrants commented that the
gated communities in Dorado tended to be separated from Puerto Rican life and culture (Figure
4.7). Jennifer loved the area, but she felt somewhat isolated from the blockchain community. She
commented that for most migrants who lived in the San Juan metro area it was easy to travel to
events and other activities, which was a major advantage for them; however, personal safety was
her priority.

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Figure 4.7. Local real estate advertisement for Dorado Beach: “Barefoot luxury at its finest!”
Spanish was not spoken by many of the migrants and consequently they usually stayed in
the urban and coastal areas away from the Spanish-only speaking mountainous regions. Local
integration into the blockchain migrant community in the areas where migrants resided
succeeded due to the bilingual language proficiency of the local community there. Thus, the
nature of cultural integration that occurred was usually one way, with some Puerto Ricans in
areas popular with blockchain migrants embracing and growing used to migrant lifestyles and
practices. Locals embedded in the blockchain migrant community benefited from knowledge
transfer and business opportunities brought by the migrants, but many migrants were not able to
enjoy the benefits from educational and cultural exchange with local Puerto Rican communities
as they could not speak Spanish.
A combination of Latino culture and island living led to a distinctly different way of
doing business in Puerto Rico compared to the more merit-based American system. Expertise
and skill were not the initial focus. Most blockchain migrants concentrated on getting to know
each other first as friends on a deeper human level, through networking events and parties and
then progressing to a professional level later. Ghost described the Latino way:
“Here in Puerto Rico, within a very short time of meeting someone, they’ll ask your
name, and both family names because it tells who your father and mother are. Then it
gets into a conversation of who do you know. Puerto Rico is very, very much who you
know. Because everybody knows everybody at some level, right? The people that you
know will vet you or not. They’re all going to say, ‘yes, that’s a good guy’ or ‘you know,
no, he’s a good guy, but—’ They’re not usually very rude unless this person has done
something against them. […] It’s sort of a self-check system. It’s who you know, where
you are, where you’re from. That stuff all builds on its own.”

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This self-check system was replicated by the blockchain migrants. Personal and
professional reputation was of the utmost importance, especially as the island was so small and
the blockchain community was so close knit. One participant explained,
“I think some of the community is self-policing where it’s just-- We know that you’re
being a dick, sorry. We know that you’re being a bad person, or we know that you’re
mistreating women, so you don’t have a place in this community. You’re not welcome
here. If you’re willing to say you’re going to get some help or you’re not going to do this
again, or you’re going to change your behaviour, then we’d consider it.”
Leigh noted that the migrants did not want to “be a self-selecting tribe”, but they did want
community members to help each other and treat others with respect. Discussions about how to
deal with bad behaviour occurred in WhatsApp group chats and in person. The self-policing
system naturally evolved as the blockchain migrants were a small community where everyone
saw each other on a regular or semi-regular basis, and everyone talked. Only a few individuals
misbehaved in ways that hurt others. Those that were disrespectful and didn’t change their
behaviour struggled to reintegrate at social and business gatherings or they simply weren’t
invited.
There were regular activities, parties, and events for blockchain migrants to enjoy.
CryptoMondays and Uncommon EntrePReneurs offered more formal networking opportunities
and migrants also hosted their own parties that attracted the blockchain community. In 2021, one
migrant began to host monthly Crypto Socialite Soirees on the roof of his penthouse with
swimming, networking, and drinks. Networking and making friends was easy for the migrants
due to the island’s small size, the constant stream of gatherings, the ease of communication via
WhatsApp (almost every party or event had a corresponding WhatsApp group), and the short

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distances between various homes and other venues. Any venue more than a 10-minute drive
away was considered long-distance travel. Almost everyone interacted with everyone else. It
didn’t matter whether they were significantly wealthy or not. Only a few who were less social or
more introverted or left the island regularly were not well integrated with the broader expatriate
community. Pedro, who hosted CryptoMondays, commented on the individuals who attended the
weekly event,
“You’re going to have a lot of highly successful people that are going to interact with you
on a human basis and not on a level where you go up to them and try to speak to them
and then they just basically pawn you off to one of their assistants. I don’t know if you
realise it, but a lot of people that we have in our audience are very wealthy, literally have
five assistants that work for them, and could easily do that, but they don’t. They don’t
send their assistants. They come out and communicate, and participate in the community
on their own. They do so because they want to, and that’s probably the strongest effect
that we’ve had on the community is it gives you the ability to interact with industry
leaders on a personal basis. There’s no barrier in entry, and then we have extended that to
the community and the people of Puerto Rico (Figure 4.8).”

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Figure 4.8. Pedro Rivera hosting CryptoMondays at the Red Monkey bar in Old San Juan: 15 July
2019 (pre COVID-19/crypto bull run)
Other participants noted the ease of connecting with highly intelligent and successful innovators
and entrepreneurs who had also relocated to the island. Jon explained,
“If you’re starting to lift the hood a bit in the crypto space, I won’t name drop anybody,
but there are some prominent names that have taken residency here and not just in crypto
and finance; guys like Peter Schiff and John Walden. The list of Act 20
companies/people is quite long, and they’re prominent figures. For me, it was, maybe this
is actually the place where I can network in a way where I’m one of a few people that fit
into the club automatically and therefore it gives me an opportunity to have one-on-one
time with people that maybe otherwise in a Manhattan environment or a Silicon Valley,
San Francisco environment, I wouldn’t be able to get access to. The big value is there’s a
lot of prominent faces here that aren’t prominent yet. You’re interacting with the Bill

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Gates and the Jeff Bezos of the next decade. There’s somebody here that’s creating
something that is going to be revolutionary, that right now, they’re theoretically or
technically nobody.”
Many of those who arrived in 2021 found it easier to integrate with community members and
industry “titans”, than those who arrived before them, as the later arrivals had often already built
strong industry connections based on trust, friendship, and value, with earlier arrivals. In 2021,
the structural economic and political conditions - including Biden’s tax proposals, the crypto bull
market, and the acceptability of remote working stemming from coronavirus regulations - were
right for the acceleration of migration to the island. Thus, social and professional networks
increased in size and widespread access to these networks and their knowledge and experience
significantly lowered the costs of migration for newcomers.
Professional networks and social media and messaging applications, such as Telegram,
Facebook, and WhatsApp, aided the migration process, and facilitated community building on
the island. These networks helped migrants adjust to their new social, cultural, and occupational
environment, make fresh connections, and channel opportunities. Specialist “expat” Facebook
groups provided information about moving to and living in Puerto Rico, focussed on a variety of
topics such as housing, legislation, (including Covid-related Executive Orders), and local
amenities. James used a concierge service, which he found on Facebook, to obtain his driver’s
licence, for example. Telegram groups were used for more crypto-focused discussions.
WhatsApp was used by most blockchain migrants as a forum for questions and advice about
island life and access to other resources. It was also used to help organise and promote activities
and events, and to foster relationships with other expats with similar interests or backgrounds.
One community member maintained a PDF list of public groups with corresponding URLs

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where individuals could contact him if they had a new activity or cause-related group to add to
the list.
Those who discovered the WhatsApp groups soon after migrating could quickly integrate
into the existing blockchain community. These micro-communities organised through WhatsApp
offered migrants opportunities to socialise through activities relating to hobbies, business,
cultural excursions, charitable fundraising, and volunteer initiatives, such as Christmas toy drives
and beach clean ups. Akin to community organisations used by Italians in London, as described
by Fortier (2020), the close community networks built and used by migrants in Puerto Rico
facilitated practices of migrant belongings. Involvement in networking, charitable, and leisure
activities, enabled the migrants to maintain and reproduce their ethnic identity and settle into in
their new homeland, form new connections and friendships with fellow blockchain migrants and
tax decree recipients, and some local Boricuas (Puerto Ricans), and develop a sense of
community, belonging, and support. Such interactions with members of their community
facilitated the formation of social capital (Glover & Hemingway, 2005; Warde et al., 2005).
Many, like Kyle, used the groups to make friends. He explained,
“I didn’t know any Puerto Ricans like really locals here, so I just tried to make some
friends with expats. CryptoMondays is a really big help. I just tried to keep an eye out for
any sort of event and try to go to it. You’ve got to put yourself out there. I tried to join a
lot of these WhatsApp groups as well for dancing, hiking, digital things. I went to a
couple of dancing events to try to meet some more people. I met a lot of great people
surprisingly at the Chinese New Year’s celebration.”

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Anecdotes like Kyle’s were common. Groups were created for anything and everything, from
intimate dinners to huge parties and everything in between, and the groups were used as
repositories for photos and videos from related events.
Shortly before the BTC Miami crypto conference in June 2021, a WhatsApp group was
created for all Puerto Rican residents attending (Figure 4.9). In less than 24 hours, more than 100
individuals had joined the group. Several days later, the group was over 200 strong. The group
continued to be used during the conference to arrange meet-ups with other blockchain migrants,
both as part of and in addition to the conference schedule, and share BTC Miami flyers, photos,
and videos. There were several events that were popular with blockchain professionals living in
Puerto Rico. One of these, at a Puerto Rican restaurant in Miami called La Placita, included a
panel discussion with Scott Walker, Michael Terpin, David Johnston, and Giovanni Mendez,
focused on the benefits of relocating to Puerto Rico. More than half of the audience already
resided there and most of them knew each other. Many blockchain migrants did not go to Miami
for the main conference; they went for the side events and social gatherings, looking to maintain
and strengthen their professional and personal connections. Moreover, many arranged their trips
at the last minute, fearing they would miss out, as it seemed that everyone in the blockchain
space in Puerto Rico was attending. The atmosphere created in Miami between the blockchain
migrants felt like a school trip, with seemingly limitless opportunities to learn and socialise,
which was facilitated and promoted by the communication networks that emerged from various
WhatsApp groups.

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Figure 4.9. BTC Miami WhatsApp Group
Castells (1996, 1997, 1998) posits that new technologies or technological features
generate new sociological structures, and the features and affordances of WhatsApp aided the
creation and strengthening of such structures in and around Puerto Rico. Countless other one-off
events and activities were quickly organised using WhatsApp groups. The group for a 4
th
of July
2021 beach party was created the day before the event and quickly gained more than 100
members. The spontaneous event came together quickly and organically through the ingenuity
and generosity of the migrants. Organising and promoting events for migrants was easy because
migrants were self-driven, had positive attitudes, and had the willingness and stamina to attend.
As most were entrepreneurs, they naturally possessed these qualities –they were optimistic, had a

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“get-up-and-go attitude”, and were “less risk-averse than the general population” (Walmsley &
Nabi, 2020, p. 97).
Gender diversity (or lack of)
Many migrant women came to the island because of someone else. They were partners of
blockchain migrant men. There were few exceptions. Some men, like Brian and Nico, moved
with their wives and children; however, their wives weren’t actively involved with the
crypto/blockchain community. Pedro noted that he initially moved with his wife; however, she
struggled to adapt to the lifestyle change in Puerto Rico and, ultimately, they parted and she
returned to Miami.
Puerto Rico’s reputation in the media is often negative because of reports on local safety
concerns or natural disasters. This was one reason offered as to why fewer single women
migrated to the island. Jennifer decided to live in a double-gated community in Dorado due to
safety concerns. She was more vigilant about personal safety in Puerto Rico than on the
mainland. She explained, “I still don’t go out late at night. If I’m going to be walking back to a
car, I will grab somebody from CryptoMondays and say, ‘Would you walk with me’. I’m
always, always, always aware.” However, many other women did not feel unsafe or in any
danger, especially in San Juan. They felt comfortable walking around the city unaccompanied.
The only time these migrants felt more on edge (not just the women) was when they felt
interrogated by the local population on why they had migrated to the island. One female
participant described,
“Puerto Rican women specifically have asked me when they meet me. Not what do I do,
not where I came from, not why I moved here. ‘Are you Act 20/22?’ Then randomly, this
was two weeks ago, I was on the elevator. I assume they lived here. It was a couple. The

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elevator is maybe two minutes down and it was like interrogation. ‘Hello?’ ‘Hello?’ ‘Do
you live in the building?’ ‘Yes.’ ‘Do you own an apartment here? Are you Act 60? Had
you been to Puerto Rico before you moved here?’ I was like, ‘I’m just going out to the
park.’ They were very nice, but it also felt like they were very inquisitive. Like, ‘Who is
this person? What is she all about? What is she here for?’ There are moments like this
where it feels very uncomfortable and what were their intentions? Then what were they
doing with the information? They thought I was more interesting, happy to have me in
the building? Didn’t want me here? It was unclear-- Then you worry a little bit about
your safety. I guess they were coming down so they know what floor I live on. It was just
the most random experience.”
Several blockchain migrants had similar encounters with the local population. They were
acutely aware of their position within the broader social structure and the symbolic capital
attributed to them due to a combination of their whiteness, American accent, and visible
affluence (a topic which I discuss at length in Chapter 5).
Migrant women believed that their under representation in Puerto Rico stemmed from the
lack of “women in tech”, and the blockchain industry especially. Leigh explained,
“In the industry, there’s some wonderful talented, accomplished, successful women. I
think the tech industry has predominantly been male. I’m using my first-hand experience
on how the American school system goes. The men are routed to science and tech. The
women are to other places. I think that’s changing and it’s great, but the opportunity and
the path for women hasn’t been as strong in technology as it has been in other places.
Because the tech pool is already quite small, filtering into blockchain and crypto is even
smaller. I’d say some of the people that are coming into the blockchain crypto space are

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coming in from finance and Wall Street, also heavily male. There just isn’t a high
concentration of women anywhere to start, sadly. I hope that changes. I think that’s one
of the things I’d really love to have some hand in either helping bring people in or
helping get people connected to opportunities. Some of that starts with people supporting
women and wanting them to have a role to participate; giving them opportunities. There
are Act 60 women here. There are people who have been successful in this space here. I
think the men so far outweigh the women because there’s been so many more of them in
the industry. The fact that you had very limited pools to draw from (my research
participants) says a lot about the current state of things. I hope that changes. It is an
interesting thing, why haven’t women looked at Puerto Rico as an option, or are they just
not wanting to come on their own?”
Identity and social norms can impact belief in ability and success in the technology sector
and can help explain why there are fewer women working in the industry (Del Carpio &
Guadalupe, 2018). Exceptional blockchain migrant women in Puerto Rico had learned how to
succeed in male-dominated work environments by implementing smart strategies that enabled
them to be taken seriously. Female role models and a strong network of professional friends and
contacts are deemed key for female tech career success (Del Carpio & Guadalupe, 2018).
Moreover, achieving high visibility in the industry is essential for women to climb the career
ladder (Correll & Mackenzie, 2016). Monika, for example, explained how she had taken advice
from an older female mentor friend in Silicon Valley to be “intentionally visible” and one sure-
fire way to achieve this visibility was to write a book. Her friend told her, “You will have your
ideas stolen from you by men. They’ll re-appropriate them and you will not get credit. You will
have great ideas. They will not get anywhere unless you write a book.” Her friend explained,

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“Write the book. Put your face on the book. Make it your book. It’s your brand. It’s your
calling card. It will really establish you as an expert. Then, say crazy, wild, futuristic
things in your book. Then, five years later, quote yourself, because then you’ll look like a
genius. Make predictions. No one’s going to notice if they’re wrong. They’re just going
to know if they’re right, because you are going to quote yourself and say, ‘Five years ago,
I said this would happen’.”
Monika wrote: Blockchain 101: Fundamentals of a New Economy (Proffitt, 2018). The
book functioned better than any business card. Monika explained, “No one ever forgets me.” She
continued,
“With a lot of men, especially over a certain age, they really haven’t had a lot of
professional experience in co-ed environments. Many men, I would say over 50,
especially, but even younger, interact with their mother, their sister, their daughter, or
their niece. They interact with their secretary, waitress, stewardess. They don’t have a
woman who’s just their colleague, who’s their equal. They don’t know how to. Because
of that, when I show up, either they’re really happy, and they want to make sure that I
know that they’re happy I’m here; or they’re nervous. They don’t know what to default
to. Their autopilot is mansplaining, or guiding me, or telling me things. I get into a room
with a guy, a man who’s like, ‘We need to get XYZ accomplished. I need to touch on
these three things.’ We have an agenda even, but we get to a topic, and he starts
explaining to me things I already know. I can’t politely tell him, ‘Shut up. I already know
that.’ Right? I could blow the meeting if I offend him while I try to get us back on track.
He could feel like I am disregarding his very important information, which I know is
important. That’s why I already know it. To say that, now he thinks I’m defensive, or I’m

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bragging, which is all negative. There’s no positive way to say, ‘Yes and…’ unless you
say, ‘Oh, I know. I talked about that in my book. Have you read my book?’ Then, they
haven’t read your book. Now, they don’t want to seem stupid, and they’re, ‘Oh, yes, I
did.’ It gives you a chance to then complete the conversation. Then move it to what the
agenda is. If you didn’t, they would spend the whole time explaining things to you that
you already knew. Those things that you need to get to, you couldn’t get to. They would
leave thinking, ‘Well, I’m glad I helped her, but she really didn’t know that much’
because they spent the whole time explaining things. If you can get a nice wrapped-up
way to say, ‘You don’t need to explain it to me. I’ve already actually explained it myself
here. Let’s move on.’ Then they will leave that meeting thinking, ‘We got a lot done’
because you got to the actual agenda items. Otherwise, you just waste hour after hour,
while men explain shit to you, because they don’t know how to interact with you without
explaining. They have no frame of reference to know that you truly do already know any
of this, because they don’t see anybody like you. You’re a unicorn. You must need their
help.”
Like Monika, other female blockchain migrants felt the need to address the lack of
equality and inclusion of their voices in the male-dominated industry by focusing on their
visibility and recognition by their peers pre and post migration to Puerto Rico. Women in
blockchain who had migrated to Puerto Rico implemented robust strategies to build a name for
themselves in the tech ecosystem and develop professional networks with visible leaders, by
speaking or making powerful connections on the conference circuit, attending industry parties
and events, or building community by bringing influential people together, for example. As most
were entrepreneurs, they were naturally positive passionate people and possessed self-

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confidence, persistence, and a get-up-and-go attitude (Cardon & Kirk, 2015; Cardon et al.,
2013). All had developed entrepreneurial traits from a young age, influenced by entrepreneurial
family members, partners, or education. Jennifer, for example attended a women’s college in
Massachusetts called Smith College, which she described as a “Harvard for women”. Relating to
her experience, she further commented, “It was very much pressing us into independent thinking
and a strong entrepreneurial path and/or running some giant corporation.” Entrepreneurial
personality traits contributed to the success of blockchain migrant women, and these women
were champions for using what they had learned over the course of their careers to mentor
female colleagues and friends to help fix their underrepresentation in the tech industry, and
blockchain and crypto especially. Some, like Leigh, emphasised a desire to help women gain
more financial freedom; however, getting women excited and eager to learn about blockchain
and crypto was often a challenge.
“Freedom, security, financial independence-- why isn’t that more of a priority for
women? I get that they’re busy and tired, and kids and dinner and all that, but what’s
more important than your financial freedom? What?! […] I’m very focused on women
and education. I would like to figure out a way to be doing more here on the island with
things around those topics. I’ve come through a very male-dominated industry, through
tech, and that filtered even more with blockchain and crypto. I’d love to see more ways to
get more women involved. Learning about crypto investing, getting into tech, so if there’s
a way that I can do something locally here, I’d love to figure that out. […] whether
helping them work in the industry, helping them invest. I feel like too, and maybe this is
just some of the people I’ve seen around me, but there is a great dependence on men for
funding their lifestyles for relying on their incomes and I would love that not to be a

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thing. I would love women to believe in themselves, have the confidence, get the
opportunities to build their own career, to make their own money, and then grow their
money. Once you start seeing that you can grow your money, you want to keep learning
and doing.”
I met a few Puerto Rican women who wanted to get involved in crypto and so attended
some CryptoMondays events. However, the events had a diverse audience comprising industry
experts, total crypto/blockchain beginners, and everyone in between. They were structured as
broad conversations with a host - usually Pedro Rivera who started the Puerto Rican meetup -
interviewing someone from the industry, followed by Q&A from the audience at the end. The
event was not aimed at beginners, nor was it intended to be a formal educational session. The
diverse topics sometimes made it difficult for newcomers to the space to follow the conversation.
Those new to the technology that I spoke to at these events generally wanted some hand holding
to open a crypto wallet and invest a small amount of money. Many women from the blockchain
industry in Puerto Rico expressed a desire to do more in terms of blockchain education, and for
women especially. Leigh continued,
“Locally, we have talked about this idea of getting women together, Puerto Rican
women, mainlander women. There are some solid investing women. There are people
that are way more skilled than I am to speak on investing or how to grow your money.
We could have those conversations, and it doesn’t have to be just for women, but when
you bring women together, it tends to be a little safer space or people feel a little bit more
at ease or comfortable if it’s just women. So maybe to start, it is just women where we
[ask] what does everyone want to learn about? How do we trade and discuss things
together? What’s on your weekly research list? Emily (a local Puerto Rican woman), one

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person, she and I have talked about this on several occasions. She wants to be doing more
in crypto. She wants to help more women in crypto. We all share that goal. So, what do
we do together as a group? Is it an investing club? Is it a weekly night where we’re
talking about what’s going on in the industry? Can we bring in some of the folks that
have done great work and talk a little bit about what they’re doing at a high level? It
doesn’t have to be down in the hole. Wouldn’t it be cool to have Brock talk about why
we needed Tether? Imagine having that perspective way back when. Just even
understanding stablecoins and the purpose of a stablecoin or how people are using
stablecoins. Tether is the largest user of Ethereum currently. It’s the third most volume
crypto. Stuff like that I think could be interesting for people to learn or feel more
comfortable. How do we put that into action?”
In 2021, a monthly FinTech meetup launched at the Monastery, which focused on the
financial technology space broadly, covering topics such as alternative investments and
alternative data. It took a formal educational format, with the speaker often taking the group
through a prepared slide deck. A lot of content was usually packed into these sessions and the
audience wasn’t expected to understand or retain even close to 50 percent of it. Most of the
attendees were men. While there were plenty of ad-hoc educational opportunities for individuals
who were quite advanced or established in the blockchain ecosystem, much more could have
been offered in the community for newcomers, and especially women. However, blockchain
migrant women who expressed enthusiasm about education for beginners were presently too
consumed with work and building their businesses to spare the necessary time to set something
up.

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Chapter Conclusion
The analysis of the push-and-pull factors behind decisions to migrate to Puerto Rico, plus
migrant personality traits, shared forms of behaviour, and connections fostered from migrant
networks, which played a fundamental role in the emerging blockchain migrant culture,
highlighted the processes through which migration was defined, approached, and occurred.
Brock Pierce’s arrival, followed by the revelatory New York Times article about the burgeoning
crypto community in Puerto Rico, and the numerous crypto conferences that took place at the
beginning of 2018, were the catalysts for blockchain migration to commence. Blockchain
migrants were initially attracted to Puerto Rico by tax incentives, but over time the blockchain
migrant networks and the associated sizable community on the island had become the principal
attraction for new arrivals. Brian described the migrant network,
“It’s the intangibles that I think are even more important than the dollars, and that you’re
getting some of the smartest, most successful, most innovative, most collaborative people
in the world coming here and bringing all that with them. Their networks, their capital,
their know-how, their mentorship, all of that. That’s invaluable, but I could never put a
number on that. That’s the most exciting thing for me within the ecosystem. My
community here-- there’s just so much, and it’s just growing every day.”
Correlating with the crypto bull runs of 2017 and 2021, blockchain migration accelerated
to Puerto Rico. Migration slowed in the bear market, with many migrants leaving the island as it
wasn’t financially beneficial for them to stay. The story of blockchain migration to Puerto Rico
illustrates unanticipated migration patterns resulting from government policy aimed at
encouraging economic growth and development.

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Blockchain migrants were unconventional in mindset and actively pursued a way of life
distinct from mainstream societal expectations and most institutional influence. The expatriate
community on the “Island of Misfit Toys” were the adventurous rebels, troublemakers, and rule
breakers, described in Apple’s 1997 commercial. The hacker ethic, Californian ideology, and
entrepreneurial spirit combined to create an environment ripe for innovation, replicating the San
Franciscan mentality of the 1960s and beyond. The active agency of the relatively privileged
migrants underscored by their decisions to operate around normative conceptualisations of time
enabled them to generate the freedom to devote their lives to activities meaningful to them, such
as growing their business or spending time with friends and family. The lack of gender diversity
in the community stemmed from the lack of female representation in the blockchain and tech
industry more generally, and many women in the space expressed a desire to educate and mentor
other women to help fix their underrepresentation. As a result of the vibrant blockchain migrant
networks and the favourable tax environment, Puerto Rico attracted individuals who had
manoeuvred their lives to achieve flexibility and choice, now and in the future. Like blockchains,
these self-driven and optimistic individuals employed decentralist values as they utilised their
own resources to operate within and around centralised systems in place.
Chapter 5 investigates how migrants employ blockchain technology in their day-to-day
lives and comprehend and navigate numerous and evolving structures relating to their
businesses. It also considers the impact that the increased movement of blockchain founders,
investors, advisors, and enthusiasts from the mainland are having on the people of Puerto Rico.

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Chapter 5 Entrepreneurship, Technology Diffusion, and Cultural Challenges
Chapter 4 focuses on the migrants’ migration narratives, their individual and shared
histories, assumptions, goals, beliefs, and practices. This chapter highlights the complexity of
cryptocurrency taxation and regulation. It explains how blockchain migration opens new
opportunities in innovation and entrepreneurship. Government policies that create a favourable
tax environment for foreign investment play a key role in the growth and flow of migration, and
help mitigate, contribute to, and/or reinforce positive or negative outcomes.
I demonstrate how migrants can comprehend and navigate numerous evolving structures
and argue that structural constraints in Puerto Rico often hinder launching and managing small-
to-medium sized enterprises on the island. Blockchain migrants are typically entrepreneurial and
independent by temperament and possess highly developed skills and expertise in blockchain and
other disciplines. Entrepreneurship is important for economic growth as it can enable the
accumulation of knowledge. Puerto Rico has an opportunity to be an industry leader in this field
largely because of the hub of domain expertise that is being created by the arrival of a sizable
community of blockchain migrants. However, cultural and bureaucratic obstacles often lead to
conditions that are not conducive to maximising the potential benefits to the island that the
migrants bring.
Cryptocurrency Taxation and Regulation
In 2014, the IRS defined that cryptocurrency as property, and at the end of 2017, within
the Tax Cuts and Jobs Act (TCJA), Congress clarified that any swaps or exchanges of property,
unless it was real property - i.e. real estate - was taxable. Thus, every crypto trade is taxable and
must be reported to the IRS. If those trades are not reported, the IRS may audit the individual or
send them a bill. In 2019, the IRS also issued guidance in relation to airdrops and tokens created

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from hard forks, which are instances where free tokens are “dropped” into the wallets containing
specific tokens. Airdropped tokens are classified as ordinary income for taxation purposes if
wallet holders control this newly acquired cryptocurrency (i.e. the tokens are accessible to the
taxpayer) (IRS, 2019). Airdrops are certainly not trivial. One participant identified an individual
who had been airdropped tens of millions of tokens on the 1inch decentralised exchange, which
he sold immediately. The IRS has steadily increased enforcement year after year, and during the
crypto bull run of 2021, they cracked down more than ever before. For example, many
centralised crypto exchanges, including Poloniex and Circle, were ordered by the IRS to supply
copies of the records belonging to certain investors. One tax lawyer explained at a side event on
taxation at BTC Miami, “We’ve seen more audits in the last six months than in the last six years.
[…] Now in 2020 and 2021 more so than ever before, we’ve seen about 10,000 notices sent to
suspected crypto investors.”
In recent years, new developments in the crypto space such as creating, buying, and
selling NFTs, and yield farming and liquidity provision rewards related to DeFi (decentralised
finance), have further complicated taxation. Buying an NFT with crypto is akin to selling crypto,
which is a taxable event. Creating an NFT and then selling it is generally classified as income on
the basis that it is something (e.g. graphic art) that someone produced and sold. It becomes an
asset to the buyer on completion of the purchase. When that NFT is resold, the seller incurs a
gain or a loss, akin to any other crypto transaction. However, what makes the taxation of NFTs
particularly complex is that most NFTs are collectables, and tax law classifies collectables as
alternative investments. In America, after one year of ownership, these assets are taxed as a
capital gain at 28 percent; however, if they are sold within a year, the sale value is taxed as

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ordinary income. Capital gains are not taxed for individuals who have qualified for Act 22 or Act
60 in Puerto Rico.
When tokens are added to liquidity pools on decentralised finance (DeFi) platforms such
as Uniswap or Sushiswap, holders can receive rewards that stem from fees paid by other users. A
pool comprises two cryptocurrencies and often they have a fixed 50:50 ratio. If the ratio deviates
from 50:50 because of trading, then the pool is automatically rebalanced by adjusting the price
between the two cryptocurrencies. If there is less of the first crypto than the second, then the
price must increase for the first and decrease for the second. Under U.S. taxation rules, when
tokens are added to or removed from the pool, they are treated as capital gains; however, the
rewards generated are classed as ordinary income. Taxable events occur every time the pool
rebalances. Giovanni explained that one method for reducing tax burdens on ordinary income
generated from liquidity pool rewards in Puerto Rico could be to structure them as exportation of
a service.
U.S. tax laws are complex for high-volume crypto traders. Compliance is particularly
burdensome, as keeping track of and calculating taxes for thousands of crypto trades made on
multiple exchanges and platforms can be challenging and overwhelming. For the Act 60
individual investor programme in Puerto Rico (formerly Act 22), capital gains are tax free and
individuals are not required to report to the IRS for Puerto Rico-sourced income. Thus, reporting
requirements are easier to satisfy for those that qualify. Of course, regulations constantly evolve
to catch up to technological developments. Innovations associated with blockchain technology
change rapidly and the regulatory lag is significant and ongoing. By relocating to Puerto Rico,
many of those who migrated in the 2020-2021 period explained that although they primarily

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moved for the benefits of the blockchain migrant network in place, the Act 60 individual investor
programme was an added attraction as it greatly simplified the tax reporting process.
Innovation and Entrepreneurship
Chapter 4 noted that one major motivation for many blockchain migrants moving to
Puerto Rico, especially pre-2021 before strong migrant networks had formed, was to take
advantage of significant tax incentives offered by Act 20 and/or Act 22 or Act 60. Many who
moved California and New York and other high-tax states, were primarily cryptocurrency
investors and business owners. Jon, who ran a mortgage company, had a podcast, and traded
cryptocurrency, commented on how tax benefits helped him to grow his business.
“Regardless of what your financial goals are, I think if you’re going to grow a business
and you have good intentions and you want to employ people and help stimulate
economic growth across the board, taxes are not something that actually helps. Tax is a
wealth redistribution. Especially in the United States where basically the tax revenues are
just to pay the interest on government debt that has been sold to an independent central
bank. The idea that we need to have this system of issuing treasury debt, selling it to the
central bank, monetising that debt to fund things like police and firefighters and teachers
is also nonsense. I think people are starting to realise that, hence the conversation of
modern monetary theory or MMT, which is basically printing money without the
monetisation of it. A lot of this stuff all hovers around this idea of taxation and I’m a firm
believer that tax is theft so I’m very libertarian in that way. Again, I don’t want more
money in my pocket so that I can go buy a yacht. I want to grow and build a business and
be part of an economic system that has natural thriving competition, is deflationary for
the consumer, is a good thing for the consumer and [has] cheaper prices. It means better

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products, better services. Long story short, there are very few places for a U.S. citizen, if
any, other than Puerto Rico where you have a tax regime that’s this attractive because we
are taxed on our global income. Yes, you can create various forms of corporate entities
and distribute income and wealth. The Googles do it, the Apples do it. If you’re a small
business owner you’re having success and you want to scale to do some of the things that
these mega-corporations are doing, it’s very difficult to get there.”
The tax saving incentives facilitated growth and scalability, Jon argued, and enabled
entrepreneurs to experiment as increased profits could be channelled to riskier, but potentially
extremely lucrative, innovative activities. Higher taxes limited bandwidth for such innovation as
they effectively reduced the funds available for reinvesting into the business, trying new things,
and growing. Thus, in line with Jon’s argument, an optimal taxation regime could have lower tax
rates applied to larger business turnover, resulting in the generation of higher tax revenues
overall for Puerto Rico.
Companies operating in markets that embrace disruptive technologies have “strong first
mover advantages” (C. M. Christensen, 1997, p. 15). Newcomers to a market are often agile and
can design their business processes and tools around the latest thinking and technologies from
the outset. As such, imaginative and pioneering use of the tax incentives also occurred. Brian and
Giovanni, the local tax attorney to many blockchain migrants, worked together to develop the
legal structure for DapCoin, the token for Dapp Inc. Brian wanted the token to be used to update
firmware and other technological functionality within the company’s ecosystem and asserted that
it shouldn’t be regulated as a security or a currency. Rather, he saw the coin as a utility token that
should be taxed as software as service. At the time, Microsoft was the only company on the
island that did something similar and it was cited as a precedent as Microsoft came to the island

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three decades ago. Microsoft received the export services tax break as it previously printed and
shipped Microsoft Office CDs around the world from Puerto Rico. As technology advanced,
Microsoft stopped shipping CDs and instead issued product keys to their customers, with all
software updates derived from servers in Puerto Rico. Brian explained that when applying for his
Act 20 tax decree,
“We were like, ‘We’re just blockchain. Cryptocurrency is just public-private keys. We’re
literally just issuing a key just like that.’ There was already some precedent, just different
technology behind it. That helped it go along.”
Consequently, the government wrote into the decree that DapCoin would be treated as
software as a service (software sales) and tax it accordingly.
Another migrant also worked with Giovanni to develop an innovative token sale
structure. At a CryptoMondays event, they explained that they sometimes used Bermuda as an
intermediary jurisdiction for token sales. For some [American] companies that they advise, sales
are transacted by airdropping tokens through a Puerto Rico-owned Bermuda-based entity. This
ensures that the company doing the token sale only pays 4 percent tax rather than the 10.5
percent minimum tax because of the GILTI (global intangible low-taxed income) law, which was
designed to discourage companies from moving profits to foreign jurisdictions with lower tax
rates. Puerto Rico is classed as outside of the United States for the purposes of the GILTI tax,
even though jobs in Puerto Rico are U.S. jobs and unemployment in Puerto Rico is U.S.
unemployment. However, the only place where Americans can legally avoid the 21 percent
corporate U.S. tax rate, and the 10.5 percent GILTI tax outside the United States (if using a
suitable foreign intermediary jurisdiction) is Puerto Rico.

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Access to additional capital, especially venture capital, for entrepreneurs enables business
innovation, experimentation, and expansion. Preferential capital gains treatment for investors
helps start-ups to raise capital and thus supports high-risk innovative enterprises (J. L.
Christensen, 2011, p. 496). President Biden proposes to raise the upper federal tax rate on long-
term capital gains for investors making over $1 million in annual income from 20 percent to 39.6
percent on the mainland (The White House, 2021). Such an increase could reduce the funds
available for innovation and disincentivise would-be investors. Therefore, Biden’s taxation
policy would increase the attractiveness of Puerto Rico for investors who could benefit from its
zero percent capital gains tax rate under Act 60 (formerly Act 22). Giovanni expressed his
opinion that President Biden was Puerto Rico’s number one promoter due to his proposed tax
plan,
“He’s doing a great campaign for Puerto Rico. I think this isn’t a Puerto Rico thing it’s
more general tax theory and tax legislation and serves multiple purposes. Obviously, one
is revenue collection. When certain types of income are incentivised, it’s because the
government wants to incentivise or disincentivise certain behaviours. Capital gains are
right now seen as something negative because it’s the bad bankers that are generating the
capital gains. The capital gain model is for start-up businesses to get off the ground easier
by finding investment through direct investment versus going to a bank and getting a
loan, because if you’re a new business, the bank won’t give you a loan. You’ll have an
investor, which is a risk-taker, who will invest in your company and will help you grow.
The investor’s incentivised because they paid tax on a lower rate for investing in your
company; that’s how the whole model works. You have these investors that say, ‘Okay,
we have a 10-year horizon, or a 15-year horizon, or whatever.’ Yes, they have ultimately

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been rewarded in Amazon or Uber, etc., because they have been somewhat successful,
but there are also businesses that fail, and these investors are likely to invest in businesses
that fail as well. The whole model for capital gains is predicated on, ‘Let’s incentivise
investors going after this growth and helping the start up.’ They forget about that because
they’re focusing on the winners. That’s why they say, ‘It’s unfair that you’re paying 15
percent, 20 percent capital gain rate,’ which is lower, again, because they’re just focusing
on the successful ones. I think it will affect investment into new companies and the
outlook for venture capital and angel investors. I think that’s why I don’t necessarily
agree with the Biden plan on capital gains.”
Brian was developing an investment platform for the island to launch under the Invest
Puerto Rico non-profit umbrella, whose purpose was to attract capital and businesses to the
island. He wanted to create a one-stop-shop for all investments aside from real estate, as he
didn’t want everyone selling their house to be on the platform. It would be open to any Puerto
Rican company or company trying to expand into Puerto Rico. They were partnering with
Parallel 18, the largest accelerator on the island, to attract start-ups that needed to gain exposure,
raise capital, and locate investors. By working across Uncommon EntrePReneurs and Invest
Puerto Rico, Brian helped advance the island’s innovation and entrepreneurship ecosystem.
One participant noted that he used the public Act 22 list of beneficiaries published online
by the government to help him target potential investors for his company, as many Act 22
beneficiaries were angel investors. With increased investment from the mainland, Puerto Rico
has an opportunity to stimulate the development of venture capital markets, which could
stimulate innovation and growth. As investors tend to rely on localised personal and professional
relationships, the island’s small size supports strong information flows and trust between the

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parties, making it a good fit for angel investors and venture capital firms as it is easier for them
to monitor and get involved with new enterprises (J. L. Christensen, 2011). As Alexander
observed,
“People are much more open here about sharing things. If you’re looking to do investing,
it’s incredibly useful because you’re going to find out about all kinds of cool stuff that I
wouldn’t even know about in San Francisco. On that front, it’s been good because I’ve
been able to get into private companies, blockchain deals, all kinds of things that I would
have had zero access to; I wouldn’t even have known how to get into. That’s huge. I
probably wouldn’t have known about those things if I wasn’t here.”
Innovation can also encourage investment capital access, as it builds trust with other
investors who recognise the value of the innovation and want to participate; but, as one
contributor noted, “If you don’t have liquidity in the market, there is no creation of value.” Thus,
to promote innovation, the tax code must be structured in a way to benefit investors and
entrepreneurs who are willing to take risks.
Innovation
Schumpeter (1943) defined entrepreneurs as innovators who, above all, are the driving
forces behind industrial development and growth. This in turn leads to the progress of
civilisation and raises the standard of living. Innovations drive economic evolution by “doing
things differently” in the realm of economic life (Schumpeter, 1939, p. 84). They trigger small
increases in the gross national product and preserve capitalism from destruction, due to
improvements in the productive efficacy of the economy and efficiency of production, which
reduces cost (Schumpeter, 1943; Bazhal, 2017; Xiao, 2020). Thus, entrepreneurs are at the centre
of capitalist economies. They must continuously evolve, or risk losing that which affords him or

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her social prestige and influence (Sweezy, 1943). Innovative entrepreneurs can easily uncover
and seize new market opportunities, and start-ups are an exceptional vehicle for them to channel
their entrepreneurial ambitions (Wennekers & Thurik, 1999).
Puerto Rico is encouraging innovation and entrepreneurship through its attractive tax
incentives. Indeed, Schumpeter (1918) in The Crisis of the Tax State argued that entrepreneurial
profit from innovative endeavours is the “premium which capitalism attaches to innovation” and
should that profit be “taxed away” then innovation and progress would slow. Innovation drives
increased productivity, which in turn can drive economic growth by enabling businesses to
produce more with fewer resources.
Large, centralised “traditional slow-paced and bureaucratic” systems of innovation
struggle to compete with relatively agile, more decentralised entrepreneurial systems (Lerner,
2012, p. 41). Beck commented on how Puerto Rico could be a good sandbox for innovation due
to its small size,
“It’s small enough and it has a dynamic, educated population. The people that are
surviving here can be some of the best entrepreneurs I think, with the mixture between all
the new technologies and new business models, I think we can have some really exciting
stuff happening here.”
Innovation usually flourishes on the fringes. Indeed, Christensen’s (1997; 2003)
disruptive innovation theory asserts that smaller more nimble players can embrace disruptive
technologies more easily compared to long established companies. Incumbent companies fail
when faced with disruptive technologies because they focus heavily on sustaining existing
practices and conditions, implementing incremental rather than radical changes to existing
processes and products that are focused on serving their current customer base. Puerto Rico’s

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greatest challenges were also its greatest opportunities for innovation. Highly vulnerable
infrastructure systems were ripe for innovation, for example. Jon reflected,
“In the tone of the crypto space, it makes you realise how centralised everything is, and
how you can apply that decentralisation theme to so many aspects of our day-to-day life;
decentralising the power grid, decentralising food, water et cetera. The crypto space is
bringing that type of creativity and entrepreneurism to the day-to-day things that most
people take for granted.”
Some blockchain migrants operated disruptive businesses. Nico, for example, founded a
microgrid company called DexGrid which utilises the Ethereum blockchain and renewable
energy from the sun, wind turbines, and other sources to build a sustainable and resilient energy
system for Puerto Rico. Capturing data from smart meters attached to energy sources, such as
solar panels, and publishing the data to the blockchain, enables electricity generation and
consumption to be monitored, and demand predicted. Nico wanted to challenge the incumbent
centralised system, managed by the Puerto Rico Electric Power Authority (PREPA), a public
corporation of the Puerto Rican government (that was handed over to Luma Energy under a
public-private partnership on 1 June 2021). The incumbent system was long considered
vulnerable, unreliable, and inefficient, and generating all the island’s energy in the south before
carrying it to population centres elsewhere was felt to be a contributing factor. There is a history
of regular power outages, sometimes lasting weeks, especially following natural disasters such as
hurricanes and earthquakes. Disruptive decentralised innovations such as blockchain-based
community microgrids might lower prices, improve reliability, and provide a higher quality
service for Puerto Rican residents. Generally, there were few blockchain innovations on the
island that had the potential to disrupt the local market and positively impact the lives of

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residents. Business operations were typically international in nature as the tax incentives focused
on export services, as the government wanted to bring in financial capital from outside but
discourage local competition.
Blockchain migrants generally saw centralisation as a signifier for order and long-
standing traditional business processes, whereas decentralisation implied freedom and it thus
opened the door to intuition and led to innovation. Just as they employed decentralist values in
their personal lives to achieve flexibility and choice, operating within and around the constraints
of the centralised systems in force, they also utilised these principles in their professional lives.
Brian, for example, came to the island with his blockchain company, Daplie, which was sold in
2019. In 2018, he started a parallel software company, Dapp Inc, and recognised that it made
sense to join Invest Puerto Rico, a business and talent attraction agency, as he had previously
built an investment platform and he had knowledge and experience in investment crowdfunding.
Working with Drew, he also co-founded Uncommon EntrePReneurs, a weekly networking event
for both locals and new arrivals that took place in either San Juan, Rincón, Palmas Del Mar, or
Dorado. At the end of 2021, Brian also led the charge in organising a week of blockchain
conferences and events under the banner Puerto Rico Blockchain Week.
The accessibility, variety, and number of projects available to plug into was not lost on
the new arrivals. They were excited about the many opportunities on the island, especially
because they had relevant knowledge and skills that would add value to entrepreneurial
endeavours. Monika, who arrived in 2021, highlighted the stimulating environment offered to
newcomers by the existing migrant network.
“I have people that keep coming to me with their businesses saying, ‘Please, work for us
or work with us.’ I’m really in the exploratory phase right now and I’ve been invited to

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be a part of two or three projects. Some involve tokenising real estate, and some don’t.
Some are just on the investment side and wealth management side. I’m really just saying,
‘How can I do as many of these things as possible?’ For me, it’s way too easy for me to
be a workaholic and I’m a kid in a candy store here right now.”
The migrants’ diverse expertise, experience, and resources was enhanced by regular
meetups and events that facilitated useful information sharing and cross-pollination of ideas that
shaped business outcomes. Migrant flexibility and agility together with the decentralisation of
entrepreneurial labour created an environment conducive to new projects, ventures, initiatives,
and community offerings, and ultimately innovation.
The rate of innovation in a country affects its “dynamism”, which in turn impacts
international trade (Posner, 1961). Puerto Rico recognises its need for innovation in targeted
industries to facilitate economic growth through the multitude of tax laws that have been enacted
in recent years. Ninety-eight percent of Puerto Rico is classified as an Opportunity Zone (OZ).
The purpose of OZs is to boost economic growth and job creation in selected low-income and
underdeveloped localities by attracting private capital investment. Under the provision, corporate
or individual investors are given the benefits of deferred or abated capital gains and so those
eligible gains remain untaxed. They can defer the capital gains taxes by moving the gains from
the sale of appreciated assets into funds that invest in opportunity zones, within 180 days of the
sale (Jacoby, 2019). Other incentives aim to promote tourism, agriculture, manufacturing,
international banking, insurance, and local film production. Some blockchain migrants were also
involved in innovative endeavours that did not integrate blockchain technology. Jennifer, for
example, was a blockchain migrant and film writer, who had moved to Puerto Rico for the
“crypto community”, to escape the “politically charged” U.S. mainland before Biden’s election,

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and to take advantage of the significant tax incentives for filmmakers. Like Jennifer, blockchain
migrants often brought added value to other industries that also received incentives from the
Puerto Rican government to encourage economic growth.
Technology diffusion and knowledge transfer
Diffusion of [a successful] technology typically follows an s-shaped or sigmoid curve,
whereby adoption is slow, then fast, and then slow as diffusion reaches a saturation point (Figure
5.1). Akin to the evolution of the internet, which birthed the “networked society” (Castells,
2010), blockchain technology is potentially transformative in this way as established processes
may be dismantled and completely reimagined. Blockchain is a disruptive technology that
threatens legacy financial systems, for example.

Figure 5.1. Diffusion curve and bell curve (Lechman, 2018, p. 54)
Giovanni believed that the main benefits from the tax incentives programmes were job
creation and knowledge transfer. The generation and sharing of knowledge is critical for the
performance of an economy, and it is driven by network effects and social ties between groups
(Klarl, 2014). Knowledge flows also tend to be localised where word-of-mouth or interpersonal
communication networks are strong (Bass, 1969; Klarl, 2014). In San Juan, there were regular
events and activities aimed at blockchain migrants. The barrier to entry was low and it was
relatively easy to access community members, including the most financially successful

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individuals. Giovanni explained how he broke into the industry, which ultimately paved the way
for him to become the most popular tax attorney on the island for blockchain migrants.
“There was a conference here called the Puerto Rico Investment Summit that ran for a
few years based on these incentives. Michael Terpin was a speaker. I was there with my
company, who was a sponsor. I met Michael, and then he became my client. I had done
some work prior to that regarding bitcoin, but from the compliance and investor side. My
client was investing into a product that a high-profile bitcoin person was doing at that
time, so I was doing work for my client. I was a little familiar with the bitcoin aspect. I
knew some words, met Michael, and understood a little bit of what he was doing. After
that, I started getting more clients and learning more, again, from a regulatory
perspective. When these types of people or an investor came into the firm, they’d just be
sent to me because I was the only one that understood that language. So, then I grew a
practice and grew a passion for it.”
Giovanni’s in-person interaction with Michael Terpin facilitated productive knowledge
diffusion. Tacit knowledge is understood through knowing something without being able to
logically explain it and is demonstrated by expression in action (Brophy, 2009). Productivity
induced knowledge is highly tacit in nature and the transmission of it tends to follow a highly
geographically localised diffusion pattern in informal settings (Bahar & Rapoport, 2018).
Blockchain migrants are the carriers of tacit blockchain knowledge in Puerto Rico.
Rogers (2003) analysed the adoption and diffusion of ideas. He was the first to formally
articulate the diffusion of innovations theory, and described it as the process by which “an
innovation is communicated through certain channels over time among members of a social
system” (p. 5). Therefore, diffusion is the accumulation of decisions to adopt [or reject] a new

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technology. Events popular with blockchain migrants, such as CryptoMondays, were generally
open to anyone, but the ratio of expatriates to locals tended to be slanted towards the migrant
audience, probably because they were conducted only in English. Antares, a PhD-educated local
woman who Brock Pierce hired to lead his Integro Foundation, believed that there were a lot of
“non-believers” in the local community who did not understand the benefits of blockchain
technology, and she thought that education was needed. Moreover, she saw lack of trust and
knowledge-related barriers to entry, and a generational divide arising from the digital nature of
the technology: “Either you know or you don’t. Either you’re a believer or a nonbeliever.”
Antares explained that she would sometimes talk to her friends about the technology, and their
initial reaction was, “Oh no, that’s sketchy.” However, once she gave them more information,
they were more receptive and thought it was “really cool”. Many locals were not exposed to the
communications channels and word-of-mouth networks popular with blockchain migrants that
could help them learn about the technology unless they intentionally got involved.
The potential for technology and knowledge diffusion and transfer was great due to the
expertise, talent, and new ideas brought to the island by the migrants, but actual diffusion and
transfer occurred slowly. Blockchain education and technological know-how appeared to be the
largest barriers to overcome. Puerto Rico’s aging population has a median age of 39.5 for men
and 43.2 for women (World Population Review, 2021). In 2019, local universities on the island
graduated 26,500 students in science, technology, engineering, and maths, which was six times
more than numbers in the highest states on the mainland (Invest Puerto Rico, 2020). However,
the “brain drain” caused by the departure of young, skilled, and educated Puerto Ricans in search
of new opportunities helps explain why diffusion was not occurring at a socially optimal rate as
many in the remaining population were elderly and less technologically skilled. Several

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campaigns launched to thwart the “brain drain” (Figure 5.2). Yo no me quito, which roughly
translates to “I don’t quit”, was a movement created in 2016 to “inspire”, “uplift” and “help
Puerto Ricans envision a better future” (Carrero, 2016). The campaign’s hashtag #yonomequito
was popularised on social media at a time when many professionals, such as doctors, lawyers,
educators, and healthcare workers, were leaving the island. The hashtag was also used during the
protests to remove Governor Ricardo “Ricky” Rosselló and to solicit aid for residents affected by
the 2020 earthquakes in the south of the island. Giovanni wasn’t sure how impactful the
campaign had been, however, as in his view some people whose personal circumstances gave
them little choice were “better off leaving”. In 2020, another campaign, El Comeback, was
launched to attract talent back by matching skilled individuals abroad with job vacancies in
Puerto Rico. Unfortunately, awareness of these programmes was lacking and more outreach to
local universities and high schools was needed to persuade young people not to leave the island
after completing their education since there were professional opportunities available locally.

Figure 5.2. Local campaigns to address the brain drain
Giovanni explained that early in his career he was tempted to leave for more lucrative
opportunities on the mainland where he could have made “2.53 times more money just off the
start”, but he stayed because of his family, the land, and the culture. He felt that what he did
“helps improve the island and helps actually keep more people here”. His company had grown to

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a team of eight Puerto Ricans, and he confirmed that, “Nobody is close to minimum wage; not
even my secretary.” His sister was a doctor and stayed on the island for similar reasons. He
believed that Puerto Ricans who manoeuvred their lives to stay on the island, did so primarily
because of their cultural ties.
The local Puerto Ricans who had [intentionally] become involved with the blockchain
migrant community had generally benefitted from opportunities presented to them through the
network. A local woman became the go-to personal trainer for many of the migrants, just as
Giovanni emerged as the go-to tax attorney, for example. Giovanni believed that knowledge, not
financial capital, was the most valuable asset brought by the migrants. Many locals learned about
blockchain technology and some even invested in crypto assets because of interactions with
migrants. Annie, who once worked for the Department of Economic Development (DDEC) and
currently works for the Puerto Rico Chamber of Commerce, and the Puerto Rico Science,
Technology, and Research Trust, was a self-confessed “dinosaur”. However, she had learned
more by attending Uncommon EntrePReneurs, CryptoMondays, and other events and had bought
some crypto. Antares had begun her blockchain journey through working at the Integro
Foundation for Brock. Valeria, a local recent graduate, was hired by Levidge, a migrant-owned
blockchain company that offers a trading platform for cryptocurrencies and assets such as gold
and stocks. Her job at Levidge was her first introduction to blockchain technology. At the
beginning of her employment, she studied blockchain every day after work. Her boss, a
blockchain migrant, taught her about the technology and industry.
“Whenever I have a question, he will answer; he’ll sit down with me, explain different
aspects of crypto and blockchain. He’s been more than a boss, he’s been more like a
mentor. We usually have lunch together and he’ll talk to me about maybe future steps and

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things that I might want to do with my career. He’s really been guiding me. He’s a little
shy, but once he starts talking, once you get him to open up, he’s a really amazing person;
I’m really happy to be working for him.”
Most participants generally believed the brain gain from blockchain migration supported
economic growth and development. The injection of capital into the local economy was visibly
supporting explosive growth in other sectors, such as real estate and hospitality. Pedro noted that
the Red Monkey bar in Old San Juan was closed on Monday evenings until CryptoMondays
started using it as a venue (2019-2020): “I probably added about $8,000 in monthly revenue to
their business, which makes it literally their best day of the week because of the five hours a
week that we meet there.” Stimulating development is significant for the island as several local
participants highlighted that Puerto Rico was not a first-world country. Yarey, for example,
stressed that Hurricane Maria “slapped us because we thought we were first world”; however,
supplies of water and food were affected for months and extreme poverty was still noticeable in
rural areas. It is arguable that blockchain migration may encourage further dependency on the
United States, but it may also put Puerto Rico on a path to modernisation and national
development, which ultimately could reduce unemployment and out-migration of talented Puerto
Ricans seeking better opportunities on the mainland. Giovanni described the knowledge transfer
potential arising from the arrival of the migrants, which he compared to the knowledge transfer
that occurred because of Section 936.
“If you turn the switch off and everybody who’s moved here in the last decade leaves,
every cent of knowledge that was brought here stays here, provided that the local
community stays here. I think it’s very helpful. That was the case for the manufacturing
industry having big manufacturers here in Puerto Rico; there was a lot of knowledge of

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Supply chain, Six Sigma, and Lean and from a managerial perspective. These
multinational companies invest millions of dollars into streamlining processes. If you’re
working on that, you learn. You have millions of dollars of R&D that are transferred to
you by working on something. The same thing happens with export services and
Software-as-a-Service and blockchain. All this knowledge transfer stays with the local
community, with the college students that show up to these events and learn and are made
aware of things like this and lives change because of knowledge.”
With the arrival of blockchain migrants, Puerto Rico needed to adapt to the rapid change
in skills requirements. John believed that the resulting job opportunities in programming or
executive assistance, for example, could encourage local Puerto Ricans to study computer
science, engineering, or finance. In the coding and blockchain space specifically, comprehensive
educational opportunities on the island expanded in recent years. Observing the brain drain and
skills gap issues, one migrant and his local business partner opened the Holberton School in San
Juan; a franchise coding school offering a curriculum developed by Silicon Valley engineers for
Puerto Ricans with a high school degree who had passed the admissions test. Students could
specialise in machine learning; augmented/virtual reality; full stack web development; and low-
level algorithms. The programme didn’t [yet] teach students how to code on various blockchains,
one project in the curriculum was to build a blockchain from scratch. Unlike other educational
programmes, there were no upfront tuition fees; students paid for their education via an income
share agreement of 17 percent for three and a half years after finding employment, thus avoiding
student loans. Students only needed support from family or elsewhere to cover living expenses.
After graduation, alumni were not required to repay anything until their salary exceeded $40,000
and the income share cap was set at $85,000. In Puerto Rico, the average starting salary for

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Holberton graduates was between $45,000 and $55,000 and most, if not all, of the students were
Puerto Rican. Post-graduation, these students would have the skills to help grow the island’s
economy. Other respondents agreed that blockchain education was essential to help solve brain
drain issues on the island; however, they felt that there was too little awareness of the available
educational programmes among the local population. One participant noted regarding the local
opportunities for Puerto Ricans, “They aren’t aware of what the blockchain community actually
has to offer. If you get this certification doing this thing, you really can get a job making 50-60
grand a year here on the island!”
As well as start-ups, increasing numbers of established companies have begun to create a
presence on the island because of the tax policies and migrant networks. Pantera Capital, one of
the world’s largest hedge funds in crypto, relocated in 2021, for example, and was advertising for
a variety of job roles within the company on the island. Data collected by DDEC and Invest PR
revealed that ~5,000 new jobs were created between July 2020 and June 2021 from the tax
incentives (including Act 20 [via Act 60] Act 73, Act 273, and Act 399) and the average wage
was $66,000 for those jobs.
8
It’s standard practice for many new university graduates to leave the
island in search of opportunities; but in recent years, increasing numbers of well-paid positions
have become available locally. Linking the local community to the more lucrative jobs created
by the new arrivals is a challenging proposition. Even though the island ranks first in higher
education rates for Latin America and the Caribbean (Invest Puerto Rico, 2020), the brain drain
post-graduation and the nurturing of this talent abroad is likely to produce gaps in relation to
more advanced positions in the future Puerto Rican talent pool.

8
Invest PR will release the formal report before the end of 2021.

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Erick Pinos aimed to help address the incongruence between the new job opportunities
and the general lack of blockchain skillsets of recent university graduates. Erick, an alumnus of
MIT and the CEO/President of the 501(c)(3) non-profit Blockchain Education Network (BEN),
moved to the island in 2021 and was in conversations with the Holberton School and other
organisations such as the Boys and Girls Club to teach their students about blockchain
technology.
“For us, it’s very valuable to have partners like the Holberton School where they can
teach the full coding curriculum, and then we can come in and just teach one blockchain
session or a couple of blockchain sessions. We give that extra - that last mile, the last
piece that the students here would need to be able to get those blockchain-specific jobs.”
BEN began as an intercollegiate network of bitcoin clubs that shared educational
resources and offered mentorship to learn about blockchain, at a time when many universities
were sceptical or negative about the value of the technology. It’s now a seven-year-old global
blockchain student organisation with a robust alumni network. Students can be rewarded BEN
tokens, which are redeemable for free flights and AirBnbs at blockchain conferences, for
completing blockchain courses and volunteering for the organisation. They can also search for
jobs on BEN’s jobs board and in addition the organisation actively connects students to start-ups
or the blockchain departments within larger organisations. Many past graduates also started their
own blockchain companies. Augur, a blockchain prediction platform, was founded by students
who met through BEN. Erick highlighted the opportunities available to people with blockchain-
related skills and knowledge.
“We’ve had students that are getting hired as developers or coders. We’ve had students
getting hired as community managers, students that want to go into law and policy or

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economics or tokenomic design. Now there’s interesting stuff with NFTs and being hired
as artists, or graphic designers and making multimedia and mimicking them as NFTs; lots
of ways to get involved. The other newest one is being what’s called, Governance
Champions. These DeFi projects have DAOs (Decentralised Autonomous Organisations)
to manage their treasuries. Now there’s a very new type of role where you would manage
the community. It is like being a community manager but it’s not just social media and
AMAs (ask me anything); it’s rallying the community or the token holders to vote with
their token. It’s almost like lobbying. It’s like this is our proposal, you got to get people
to vote on it, push them to vote on this, but this is from the bottom up. It’s a very
interesting new type of position and it’s hard to describe, but people are getting hired for
that kind of thing.”
Erick planned to organise a blockchain session for the Holberton students and encourage
them to sign up for BEN’s platform so that they could take more blockchain-specific courses.
In 2015, BEN was connected to the University of Puerto Rico in Rio Piedras via their
bitcoin club; however, those students graduated, and BEN lost touch with them. The patchwork
of education occurring throughout the island via community meet-up groups and educational
courses delivered by the migrants, plus existing programmes at the local universities, was
disjointed. Various schools and organisations were unaware of what others were doing in the
space and Erick tried to connect them with BEN, to share resources and fills gaps in education
and skills.
“Everyone that I’ve talked to is around universities, but no one seems to be talking to
them directly. I asked Holberton and the Boys and Girls club and they said, ‘Yes, we’re
going to get in touch.’ Nobody seems to be able to make an intro to a university. I’m just

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going to start emailing them directly because the faculty at the university don’t come to
these events. ‘Okay, I’ll do it myself then. I’ll just call to reach out.’ It’s the same process
that we’ve been doing in the Caribbean and in Africa and in India; once we get some
students or some professors that are part of the network from that region, they invite all
their friends. Depending on how much they volunteer, they can earn some BEN Tokens
and there’s rewards for referrals. I think that once we got the snowball rolling, it’ll be
really good, especially because the students we had in 2015 have all graduated. We can
bring them back as alumni, but we definitely need connections to the current students and
the current faculty.”
The blockchain skills gap is an issue and challenge throughout the industry as it is
growing, and certainly not unique to Puerto Rico. Blockchain developers are notoriously difficult
to locate and hire, as demand is high, the talent pool is shallow, and gaining expertise takes time.
Brian recognised the issue with local talent. He had only managed to hire one Puerto Rican
developer. His other employees were living in Puerto Rico already. Further, many qualified
blockchain developers “don’t want to be found” or they are working on their own projects. Brian
explained,
“They’re literally living in the jungle, only surfacing on weekends to come to San Juan.
I’d hear about a mysterious developer; I finally meet him after three months of hearing
about him, but I only get his first name. Then I see him again maybe a couple of months
later and I get his last name, but still not his number, and then eventually I get his phone
number and he’s willing to talk. Then finally I can start interacting with him and see if he
wants to work together. They were literally difficult to find; not that they don’t exist,
although there’s never enough, that’s for sure. Or they’re just doing their own thing and

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they’re not necessarily looking to work for someone else’s company, which is very
common for smart developers.”
Knowledge diffusion via entrepreneurship can facilitate economic activity and growth
(Braunerhjelm et al., 2010). However, blockchain technology is quite new and it has experienced
growing pains. Applications and use cases are still in development, the talent pool is small, and
the skills in the field generally can’t be acquired quickly. Puerto Rico has an opportunity to be an
industry leader because of the knowledge base made accessible through collaboration with a
concentrated community of knowledgeable blockchain migrants. The Puerto Rican government
can choose to recognise the island’s potential within the blockchain milieu and succeed if policy
makers enact laws that improve the availability of labour, capital, and skills within the field.
Business challenges
Effective from 1 July 2019, in response to various advocacy groups presenting their use
case to the authorities, Puerto Rico updated the tax incentives code to explicitly include
blockchain-related services as eligible business activities (formerly Act 20) and cryptocurrencies
and other crypto assets as being eligible for tax exemptions (formerly Act 22) under Act 60. The
update clarified the applicability of the incentives code to blockchain and crypto activities, as the
earlier Act 20 and Act 22 legislation omitted such a provision and therefore the government was
signalling that the island was “crypto friendly”. Despite the legal clarification in the decrees,
other administrative and legal concerns have continued to make it difficult for blockchain
migrants to do business in Puerto Rico.
Efficient use of government resources and governmental intervention could accelerate
diffusion (Jaffe & Stavins, 1994). Brock stated that he had tried to drum up governmental
support for blockchain innovation and technology diffusion when he first arrived, but his

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presence on the island became politicised and he chose not to push it further. Instead, he spent
time helping Wyoming, Utah, Colorado, and other state legislators see the benefits of
blockchain-related entrepreneurial activity and shape state laws. Moreover, the previous
governor, Ricardo “Ricky” Rosselló (2017-2019), understood and was receptive to the
technology, especially as he had an MIT education which was described by Brock as the “right
educational background”. However, Ricky was removed from office following the
“Telegramgate” political scandal. Brock called attention to the island’s predicament in relation to
promoting innovation.
“What’s so sad here is every time Puerto Rico starts to catch a break something happens
that it trips. It might be a hurricane, an earthquake. For whatever reason, this place can’t
seem to catch that break. […] It’s not to say that Puerto Rico couldn’t become a
beneficiary. They have it; it was theirs to lose. Puerto Rico could have become the capital
of innovation in the United States with so much of this happening, but for a variety of
reasons, it wasn’t very welcoming. The government here wasn’t nimble enough, probably
didn’t realise how special this was, and so the other states are lining up and grabbing all
of this innovation.”
Innovation tends to thrive in sites with a concentration of talent, knowledge, and
resources (World Bank, 2010) and blockchain migrants brought an abundance of those
characteristics to Puerto Rico with them. Although, many migrants and locals believed that the
government was stifling innovation due to excessive red tape and corruption, which in turn
impacted employment and the island’s ability to retain intellectual capacity. One reason noted by
several migrants was that government red tape in the form of onerous procedures that had to be
followed the time taken to acquire approvals and permits made it incredibly difficult for them to

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do business and seriously invest in the island. The disconnect between government agencies,
which caused miscommunication and inefficiencies in processing applications for a wide variety
of government programmes, was annoying. Social media groups were often used as outlets to
vent frustration in relation to the untapped potential. One commenter posted that getting
investors to come to the island was an “exceptionally smart first step”; however, the Puerto
Rican government needed to “make it possible for them to actually invest”. One participant
explained he wanted to do more, but
“Puerto Rico is so fundamentally broken on so many levels, that it’s very hard to help
here. You feel like you’re walking on quicksand. There’s a lot of red tape when you deal
with the government, or even people, or service providers. It just makes it really difficult
even when you have good intentions.”
Other participants believed that the bureaucracy was purposefully designed to be inept so
that money could conveniently disappear and line the pockets of those in power, and blame could
be easily shifted. David, who worked for Centro para Emprendedores, a local non-profit focused
on encouraging entrepreneurship and helping small and medium sized businesses agreed, but he
thought things were starting to change.
“Bureaucracy in Puerto Rico is big. The red tape here is huge. If you were talking about
Puerto Rico, there is corruption here in government, there is a lot of pay-for-play. Right
now, we’re going to have elections next week. We’ve had four years of PNP government.
We’ve seen that a lot of what goes through, a lot of projects that are approved, are friends
of the politicians, and what they want to do. Between the red tape and the pay-for-play, I
think it’s hard to get ahead, but I think things are changing also. There’s a lot more
aperture to different innovations that can happen here in Puerto Rico. There are good

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people also in the government. It’s just a matter of having the right meetings, meeting the
right people, to get the idea through. I have friends that are going into politics. The belief
before was, that’s impossible, that’s politics, I don’t want anything to do [with it]. I guess
the uproar is so high now that people are changing that tone, and they’re saying, ‘You
know what? If I want the things to change, I have to be the change, so I’m going in.’ I
know a couple of people that are doing that. I do think that things are going to change.”
The systemic inefficiencies typified by bureaucracy and red tape hindered the migrants’
ability to conduct business. The corruption and nepotism prevalent in the government was a
major obstacle to investment, entrepreneurship, and innovation. Political reform is key to
achieving lasting functional and structural change.
Regulatory uncertainty can create unnecessary burdens on innovation and
entrepreneurship. Existing regulatory frameworks can be struck by the force of emerging
disruptive technologies. Although, a flexible “wait-and-see” approach risks “legal
procrastination” that creates weak defaults and may lead to suboptimal regulation in the long
term (Super, 2011), many scholars intuit those regulators should be cautious rather than decisive
when regulatory disruption occurs. Puerto Rico’s lack of legal clarity regarding blockchain
technology was frustrating for blockchain migrants, especially as many had witnessed the
emergence of reasonable approaches on the mainland that promoted innovation and
entrepreneurship in the industry. Several participants highlighted Wyoming’s 2018 and 2019
blockchain-friendly laws, which were passed by a large majority vote, and clarified the treatment
of digital assets, smart contracts, and decentralised autonomous organisations (DAOs) and
enabled Wyoming banks to serve as custodians of digital assets. The state of Wyoming will

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never seize someone’s crypto private keys, for example. These participants believed Puerto Rico
had missed an opportunity. Brock explained,
“There’s very little happening here in the way of blockchain projects. Almost all of them
are moving to Wyoming. You have a lot of people here with tremendous capacity to
bring innovation to the island, but the state never did any of the legislation necessary, so
no one will start a business here. As a fiduciary, when you’re a business owner, you need
to have regulatory clarity, and the Puerto Rican government has not passed any of the
legislation, so Wyoming has now gotten that. Multi-billion-dollar financial services
companies are migrating there; 3000 new blockchain companies minimum just in the last
year have incorporated there. This is what I hoped would have happened in Puerto Rico.”
At a CryptoMondays event, Michael Terpin concurred. He commented that Puerto Rico
should copy-paste the Wyoming legislation. If someone does a token sale in Wyoming, they still
have to pay 21 percent tax (President Biden proposed raising it to 28 percent). This is because
the token is not a security; it is a product that was sold, and the tax must be paid up front. The
returns from the sale of tokens are treated as revenue. In contrast, the tax in Puerto Rico would
be 4 percent under Act 20/Act 60.
While some participants were frustrated at the lack of legal clarity, Giovanni, a
blockchain tax attorney, explained that the Puerto Rican government’s focus was on tax
incentives as it was problematic to create any new blockchain-related legislation due to conflicts
with federal regulations.
“A lot of the Wyoming regulations would be incompatible with Puerto Rico because of
Puerto Rico’s political status. A lot of the Wyoming regulations also conflict with federal
regulations. At least for now, Puerto Rico is not setting out to be a leader in experimental

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regulation, for good or bad reasons. There isn’t necessarily a motivation to do that.
Everything has been from the tax incentive initiative.”
At CryptoMondays, Michael Terpin clarified that the guns in Wyoming were a deterrent
to interference, as the state had ripped up every IRS subpoena for the last 50 years. It also could
be tougher for the SEC to overrule the tax laws in Puerto Rico as it is an American territory. In
2021 a new blockchain migrant founded the Puerto Rico Blockchain Trade Association to
advocate on behalf its members about blockchain-related concerns and inform and educate
legislators and regulators to help form the future of the industry and ensure its benefits in Puerto
Rico.
Puerto Rico offers significant tax incentives for international banking entities (IBEs) and
international financial entities (IFEs), and several crypto-friendly banks have launched on the
island, but - to protect local competition - Puerto Rican residents are not permitted to be clients.
Moreover, Puerto Rican banks, including Banco Popular and First Bank, are not crypto friendly
due to the generally incorrectly perceived money laundering risk. They do not permit activities
relating to crypto, such as withdrawing money from crypto exchanges, and they close the bank
accounts of individuals seen as directly involved in any crypto-related activities. One migrant
had a business account on the island that he was dissatisfied with, but he was unable to switch to
a competitor as they would not handle even indirect crypto activities.
“I can’t switch to another bank because they wouldn’t open an account for me. I didn’t
have any crypto coming into my business account, but it does things related to crypto,
like selling software, education, whatever. You just say the word crypto and they’re like,
‘Uh-uh.’”

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Opening a bank account for day-to-day spending helps satisfy the closer connection test rules for
Act 22/Act 60. Consequently, many migrants had a local bank account and retained a mainland
bank account to conduct crypto-related activities. Other crypto companies that theoretically
could help migrants avoid traditional banking altogether, such as Cash App, only served
mainland clients and did not permit Puerto Rican clients. Some migrants used crypto banking
services and crypto pre-paid debit cards such as Crypto.com and Swipe, so they could spend
cryptocurrency transacted in fiat currency in the real world. Several migrants also used Divi, a
token developed by the Divi Project, founded by Geoff McCabe who migrated to Puerto Rico in
2021, to refund each other over WhatsApp for small items such as meals or Ubers.
Access to local talent was limited as many left (e.g. fresh graduates from local
universities) in search of career opportunities, and blockchain-related skills were scarce. A
company on the island was looking to hire senior Python developers, for example, but couldn’t
find enough of them locally that didn’t already have a good job. So they hired developers
working remotely from South America. Annie suggested that migrants should learn more about
their new homeland to operate more effectively.
“I’ve seen, for example, that they have no clue that the labour laws are different. They
probably think that it’s the same as the USA. Some of them are a little hard-headed. With
a successful person that has already established their way of doing things, sometimes it’s
hard for them to see that things are done differently in other places, right? They will want
to replicate their formula.”
Annie recommended that migrants start the recruitment process by approaching a human
resources specialist or a staffing company who are likely to know about local labour laws and
compensation plans. Part of her role was to connect migrants to organisations and businesses, in

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academia, the private sector, or other professional associations, to aid migrant integration and
cultural understanding.
Although many local Puerto Ricans are qualified in many areas, migrants also
experienced inefficient working practices and lower service levels than those they were
accustomed to on the mainland. Beck commented on the disjointedness of the local economy
noting that, while locating a web designer was straightforward, it was difficult to find an agency
that was a one-stop shop for logos, websites, print, etcetera that could complete the work to the
same standard as a Californian agency. Further, Puerto Ricans tended to value family time over
their job and there were countless holidays that disrupted normal business hours. One participant
suggested that some locals had a “half-ass work” ethic, and consequently their level of
professionalism was not as high as in the United States. Blockchain migrants’ anecdotes
illustrated the issue,
“I go to the bank and the woman is telling me she’s going to retire soon, so I’m like, ‘Oh,
that’s nice. When are you retiring, like a few months?’ She said, ‘No, five years from
now.’ Every time we go to the bank, she talks about her retirement. You know what? She
needs to be fired, she’s terrible. She’s the customer service person for all the people who
live here, and you can’t get her to do anything. She doesn’t respond, it takes 20 emails to
get her to do something. I ordered checks months ago, do you think I have them?”
Similarly,
“I was trying to get a proposal from a local company, it’s three weeks ago now. They said
they would have the proposal for me the next day or two days after. We’re talking about
three weeks, and I’ve already sent them a few emails to ask them. I even ran into the

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founder at a party, and he said, ‘Oh, don’t worry, we’re going to have that for you
tomorrow,’ and that was last week.”
Migrants had to learn to cope with the unreliability and unpredictability in what was
viewed as quite an informal economy. Valaria, who had grown up in Puerto Rico, believed that
technology moved “at a much faster pace than Puerto Ricans do”. Participants cited “island
time” as something that tested their patience and they had to get used to, as it varied the timing of
seemingly scheduled appointments, events, and activities. It was common for meetings to start
15 minutes later, and social activities to start an hour later than arranged, for example. Justin
recalled needing to reschedule a meeting with colleagues in other parts of the world due to a
meeting in Puerto Rico that overran. However, migrants tended to adapt to the point where they
too were on “island time”. Justin continued, “It’s island time; shit happens.” The attitudes
towards time are deeply embedded in island culture. Ghost speculated that the island’s
contentious history triggered the cultural inefficiencies and slow pace of life.
“There’s three ways to do everything in Puerto Rico, the right way, the wrong way, and
the Puerto Rican way. I don’t care which way you think you’re going to do it. It’s going
to get done the Puerto Rican way eventually. This is a society that’s been long abused
over the course of 450 years. They figured out a system where they can’t stop somebody
from doing something, but they can dilate time.”
The laid-back attitude is common in Latino cultures (Croucher, 2009). While migrants
generally adapted to and enjoyed the slower pace of life, especially in relation to social activities,
they became frustrated when the lack of urgency around time disrupted their business or
lifestyle. Migrants and locals were subconsciously aware of their differences and newcomers

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realised very quickly that they needed to acclimatise to the culture, else they would struggle to
conduct business or integrate.
Migrants also felt that they were stung by a “gringo tax”, as many service providers were
perceived to “price gouge”. Jorge was searching for a Certified Public Accountant (CPA), but he
received quotes five to ten times more than on the mainland. Similarly, Alexander complained
that the local banks overcharged Act 22/Act 60 tax decree recipients, “They’re like, ‘Oh, we
have a special programme for that.’ It just charges you more, there’s nothing special they do.
That’s pretty messed up.” However, Annie commented that the perception of the gringo tax was
inaccurate as it was something that affected all island residents, “It’s not because they are
newcomers. It’s just because they are living in Puerto Rico.” Annie suggested that the migrants
tend to use word-of-mouth recommendations and sometimes their needs are quite complex and
so the higher price is justified. By utilising service providers whose clients were primarily local
Puerto Ricans the migrant community may be able to avoid the so-called “gringo tax”. However,
many migrants lacked Spanish language skills, which is potentially an obstacle to using
alternative vendors.
Vulnerable infrastructure was also cited as a huge problem. Adverse weather conditions
and natural disasters exposed infrastructural weaknesses. Power cables were above ground,
which made them suspectable to damage and frequent outages. Jon suggested that residents had
to be “preppers” in Puerto Rico, “What’s your plan B when the power grid goes out.” Major
power failures following the earthquakes at the beginning of 2020, for example, disrupted
businesses that didn’t have access to generators. Valaria explained,
“We’d have phone calls with people in Los Angeles or New York and their internet’s fine
and they want to do a Zoom call, and we’re like, ‘It’s easier if you call us through

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WhatsApp’, just because the WiFi wasn’t working. A lot of times, we had to work from
different places, so we moved around looking for power and internet because both were
down.”
Some municipalities only had access to satellite-based internet, which was unreliable and
slow and impacted migrants’ ability to work from there. More rural areas didn’t always have
access to clean water or were subject to water outages or shortages. Hurricane Maria, in
September 2017, followed by the earthquakes in January 2020, and then COVID since 2020
made (re)building challenging, as these natural disasters made the infrastructural problems not
only visible, but worse, and COVID negatively impacted local businesses and the economy.
Business challenges reflected the cultural differences and resource disparities between the
local Puerto Rican community and the blockchain migrants. These differences were heightened
in times of crisis, recovery, and change. Adapting to the distinct local environment and
displaying sensitivity to Puerto Rican customs, traditions, and practices, could help migrants
overcome cultural barriers and transition to island life.
Act 22 and Cultural Divisions
Puerto Rico struggled under the weight of its huge debt for years and the tax incentives
were enacted to help facilitate economic growth following the 10-year phase out of Section 936,
which concluded in 2006, that offered federal tax incentives to manufacturing corporations.
Evidence suggests that Act 20/22/60 directly and indirectly improved employment and economic
growth conditions on the island, albeit less rapidly than the Puerto Rican government had hoped,
as the downward trend in unemployment after 2012 slowed, but did not cease (Figure 5.3).

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Figure 5.3. Total Employment and GDP, 1950-2018 (Econometrika Corp, 2021)
Giovanni explained that the programmes changed over the years depending on what the
government wanted to incentivise. Sometimes the Puerto Rico government wanted to incentivise
revenue collection; at other times they incentivised charitable giving or job creation. The
Individual Investors Act was implemented to encourage wealthy people, who would generate
sales and property tax revenue and increase overall spending and job growth, to move to the
island. To comply with the programme, tax decree holders are expected to meet the Puerto Rico
resident physical presence and closer connection tests. They must reside on the island for at least
183 days or spend less time in the U.S. or any other country than in Puerto Rico during each tax
year. They must also demonstrate that they have a closer connection to Puerto Rico than the U.S.
by, for example, having a permanent home, personal belongings, bank account, and drivers’
licence on the island. Recipients must also make annual charitable donations (which increased
from $5,000 under Act 22 to $10,000 under Act 60 in 2020). Act 60 decree holders must also
purchase a house and use it as their primary residence within two years. The government’s
required donation increase in 2020 raised the overall cost to maintain the programme, making it
less attractive to start-up entrepreneurs than higher-net-worth individuals to relocate.

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Of all the blockchain migrants, crypto traders arguably benefited the most from the zero
percent capital gains tax rate via the acts for individual investors (Act 22/Act 60) as every crypto
trade is a taxable event. Some invested in and traded only crypto, and others had a much more
diversified portfolio and engaged in angel investing and other start-up endeavours, thus
promoting innovation and entrepreneurship on and off the island. In addition, investors had to
pay other taxes and Puerto Rico received additional indirect economic benefits in other sectors,
including hospitality, retail, and real estate.
Non-profit competition
Annual charitable contributions paid before December 31 to a government-approved
charity were mandatory under Act 22 and Act 60 for individual investors to maintain their tax
incentives. For decree holders under Act 60, $5,000 was required to go to an organisation that
helps end child poverty listed by Comisión Especial Conjunta de Fondos Legislativos para
Impacto Comunitario (CECFL) and the other $5,000 was required to go to a Puerto Rican non-
profit not on the CECFL list that is certified under Section 1101.01(a)(2) of the Internal Revenue
Code of Puerto Rico. Blockchain migrants generally selected their donation recipients based on
their personal interests, especially when they had the opportunity to see where the money was
going. Brian, for example, donated to his church and humanitarian projects. Beck donated to
causes such as Edublock, a local blockchain education organisation, and to a boxing and MMA
gym in La Perla that he attended. Several participants donated to Save A Gato because they liked
cats. Other participants donated to the Act 20/22 Society, whose membership fee was $5,000, the
full donation requirement under Act 22. Near the December deadline, organisations that accepted
online credit card donations were popular for those who hadn’t already donated. Some

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participants donated to several causes; however, if the deadline was looming, they often found it
too onerous to research different non-profits and payment options, so they only donated to one.
Charitable organisations that resonated with the migrants had typically developed strong
public relations strategies to attract donations. The Integro Foundation was generally well known
by the blockchain migrants as it was owned by Brock Pierce, one of the more prominent
migrants. Antares, the local Puerto Rican woman who led the foundation, explained that admin
costs for Integro were not paid from with regular donations, but were funded through different
channels, as they wanted to ensure that all donations were put towards their causes. Participants
commented that Integro were doing an incredible job partnering with local organisations and
helping them overcome challenges. The foundation held fundraising events such as an elaborate
$250-$500 cocktail/dinner event to support the Puerto Rican Olympic team and a $30 club night
at Vivo Beach Club where 10 percent of ticket sales supported the recovery of the Puerto Rican
parrot population. Antares explained that after the first club-night fundraiser, the foundation
hoped to hold regular monthly fundraising events where world-renowned DJs would play
alongside local Puerto Rican DJs; however, this proved impossible when the pandemic hit and
the island went into lockdown. Integro’s fundraisers were popular with the blockchain migrants
especially because Brock Pierce, described by one participant as “the Elvis of crypto”, often
attended.
Uncommon EntrePReneurs regularly featured charities at their events. As a result, Brian
and Drew who ran the event, were more exposed to non-profits than the average blockchain
migrant. David, who was the Director of External Resources and Alliances at Centro para
Emprendedores, a local non-profit focused on supporting and mentoring entrepreneurs from new
and existing businesses, stated that they had received between $5,000 and $10,000 in donations

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in 2019. Since then, the organisation had built relationships with Uncommon EntrePReneurs and
the Act 20/22 Society to increase awareness of their cause to hopefully raise more money. With a
colleague, Brian developed a donation platform for Donate PR, which was a similar platform to
the investment portal implemented by Invest PR, but for Act 22/60 donors. Many charities
highlighted by Uncommon EntrePReneurs, including Centro para Emprendedores, were listed on
the platform, which aimed to simplify the donation process. Likewise, Integro was developing a
donation platform as transparency was of utmost importance to demonstrate to donors and the
local community where donations were going. In that vein, the organisation was in the process of
implementing blockchain technology to allow donors to track their donations and ensure that
their contribution arrived at the intended place. Once implemented, the technology should further
enhance Integro’s reputation by providing the capability for a secure, immutable audit trail and
transparent end-to-end donation tracking. The infrastructure that blockchain technology provides
would therefore enable the foundation to demonstrate that contributions were used honourably
and with integrity.
Several participants made a $5,000 donation to the Act 20/22 Society, in exchange for
their Society membership. In turn the Society represented its members, and donated on
members’ behalf to other charitable organisations. Blockchain migrant members cited the
Society’s regular events and migrant support and representation as their main reasons for
donating. Distinct from the majority of blockchain migrants, the older, “more buttoned down”
members of the Society most often lived in Dorado and were from the traditional banking sector.
Migrants’ opinions of the events varied. Some enjoyed the networking opportunities and had met
some interesting individuals. Others found them boring and preferred Drew and Brian’s more
relaxed Uncommon EntrePReneurs events. During the COVID lockdown, the events stopped,

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and donors were frustrated as they weren’t receiving all the benefits that came with Act 20/22
Society membership.
The Society offered additional advantages, such as access to an application that tracked
the number of days spent on the island to satisfy the closer connection test, and access to health
insurance that was only available to society members. No other health plan in Puerto Rico
provided cover that allowed individuals to see doctors both in Puerto Rico and on the mainland.
The plan also gave members access to Pravan Clinic, an English-speaking concierge service.
Alexander explained that it was costing him $600 per month, a price affordable for most
blockchain migrants. The Society was self-serving as the contributors received great rewards for
donating.
Some organisations, such as Integro and the Act 20/22 Society donated to local charities,
but other non-profits set up by migrants did not. New charities substantially increased the
amount of competition for funding between the non-profits, and some local long-established
organisations received little-to-no benefit from the Act 22/60 donation requirement. Yarey, for
example, was frustrated that she received most of her money from the diaspora and stateside
donors for her Taíno school and the surrounding impoverished community, and she criticised the
local government for allowing the migrants to set up non-profits on the island.
“I think there is a lot of competition that shouldn’t be. A lot of organisations are really
getting into this for self-interest, not to help the community. They’re there for self-
aggrandisement, so they can fill their pockets.”
However, it must be noted that Yarey placed great importance on donors visiting the
school before donating, and many migrants were too busy to make the time to visit, which
perhaps creating a barrier for them so they directed their charity money elsewhere.

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Many blockchain migrants also volunteered time to good causes. Beck went to Guanica,
the epicentre of Puerto Rico’s earthquake in the southwest in January 2020, to help distribute
water, blankets, flashlights, and snacks to displaced local community members. Justin canvassed
donations through his personal Facebook page and travelled to volunteer.
“I was like, ‘Hey, I imagine that these kids are bored out of their mind. They’re probably
driving their parents nuts; would anybody help me to get some games and stuff for these
kids?’ We’re going tomorrow morning, anybody that wants to donate, hit me up.’
Literally, within 12 hours, I had over $600 in donations. I went to Walmart and bought
$600 in games and toys, hula hoops, and balls. We went down and gave it out. It was
beautiful; so much fun to see these kids playing.”
Leigh helped Integro with food and mask distribution in the early days of the coronavirus
pandemic. Ghost, under the Integro Foundation’s umbrella, led the search and rescue team in the
Bahamas after Hurricane Dorian in 2019, a hurricane that narrowly missed Puerto Rico. Brock
also opened his expansive rolodex to bring in donations.
“I was leading that team to go to The Bahamas to do stuff that I’ve done before and I had
done nonstop. Brock came back and he said, ‘How’s it going?’ I said, ‘Dorian just missed
Puerto Rico. It did hit the Bahamas and those people are in a really bad situation.’ He
goes, ‘What can I do to help?’ I said, ‘Brock, I don’t know, what can you do to help?’ He
pulls out his phone and just sits there for like 20 minutes. What he was doing was setting
up a WhatsApp group, pulling in everyone he could think of that might have something
to help and just turned [it] into this amazing thing, that within 24 hours, 300 tents that
would house several thousand people were donated. We had just people saying, what can
I do?”

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Blockchain migrants also donated money and time towards causes that weren’t under a
formal non-profit umbrella. At the end of 2020, several groups, including one organised by
Pedro and CryptoMondays, arranged a Christmas food and toy drive (Figure 5.4). They arranged
for wholesale pricing, bought well over 1,000 toys, and raised over $27,000. As with other island
activities, the toy drives were organised through various WhatsApp groups, requesting
community assistance with logistics, gift wrapping, and additional purchases, such as festive
identification stickers. The toys were distributed to underprivileged children in La Perla, Yauco,
Guayanilla, and other locations.

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Figure 5.4. Toys ready to be wrapped for underprivileged local children, Christmas 2020
Beyond the donation requirement written into the law, many migrants felt a moral
obligation to actively volunteer their time to causes they felt were important. A genuine
commitment to social responsibility via formal and informal volunteer efforts, however, exposed
the structural and systemic inequalities in wealth, and social and economic power. The migrants’
social networks could be used to quickly obtain resources for aid, supplies, and support and their
relatively privileged position allowed them to organise around perceived local needs from the
ground up. Many of these activities were not generally carried out by the local Puerto Rican
population and thus volunteer labour had the potential to distance the blockchain migrants from
the local community.
The real estate boom
The influx of migrants in 2020-2021 inflated housing prices. Dorado was viewed as
overpriced and “full”, and Palmas del Mar was almost saturated. San Juan became expensive in
districts like Old San Juan, Isla Verde, Ocean Park, and Condado, due to low supply and high
demand. Many blockchain migrants preferred the San Juan metro area as it was considered more
“expat friendly”.
Unlike Act 22, the individual investors component of Act 60 required decree holders to
purchase a house and use it as their primary residence within two years. The acceleration of
migration to the island drove rapid price increases, frustrating the ability for some migrants to
satisfy the Act 60 house purchase requirement. Jennifer explained that many homeowners in
Dorado were not interested in selling their properties due to their rapidly escalating value.
Considering the units in her gated community, she explained, “Many of these units stand empty
all the time, but they will not sell; nobody’s selling. Everything’s gone up a $100,000 a month in
Dorado right now!” Her $500,000 offer to purchase a property in Dorado was accepted and the

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deal was almost finalised. Three months’ later, at the time of the interview, the property had
increased in value to $800,000. She said that if the sellers backed out of the deal, she would
struggle to enter the housing market at the greatly inflated prices.
Several blockchain migrants sold crypto to buy outright or pay off the existing mortgage
on their house. A small number used crypto as collateral to borrow money to purchase a house,
which was seen as a smart thing to do as the house could not be repossessed. Some migrants
were concerned that the island was going to run out of housing for new arrivals, which could
place more strain on the island’s fragile infrastructure: “What are we going to do for permanent
housing for 50,000 or 100,000 or 200,000 people coming?”
Migrants generally expected a different standard of living to the local population. Most
lived in a relatively modern apartment or penthouse near the coast, or a large house in a gated
community, whereas local people often lived in simpler living conditions, in basic housing,
usually away from the coast (Figures 5.5 and 5.6). Prices for local housing were as little as
~$50,000 and those for sale were often advertised on social media sites such as Facebook. Many
houses inland were built without permits and did not even have formal addresses, making it
difficult for the postal service to deliver mail or packages. The tastes and preferences expressed
by local Puerto Ricans compared to the blockchain migrants diverged dramatically due to the
varied opportunities and constraints faced by both communities.

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Figure 5.5. PRelocate mailshot advertising a high-end luxury home for sale, 2 August 2021

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Figure 5.6. Typical local houses, south of Puerto Rico Highway 26 (PR-26), close to Ocean Park
Since 2012, many urban neighbourhoods have been transformed from high-crime areas
into desirable residential areas. In 2012, billionaire real estate developer Nicholas Prouty bought
Ciudadela, an upscale apartment and retail development in Santurce, San Juan. Santurce was
then a poor, crime-ridden area, with numerous abandoned buildings and a lot of prostitution.
More recently, however, it has become a trendy, attractive, and relatively safe and affluent
neighbourhood. Many locals appreciated the tangible improvements to the area and the new and
improved amenities, services, and retail establishments catering to the tastes and values of the
migrants. Valaria also experienced the transformation of Calle Loiza in recent years. What is
now a trendy street with hipster bars, restaurants, and boutiques that she described as “the
Brooklyn of Puerto Rico”, used to be very dangerous.
“Ten years ago, you couldn’t go on that street because literally, you’d get mugged or shot
or something; it was extremely dangerous. I went to school here, and it’s a private school
so my mom wouldn’t let me get out of the car on that street because I was wearing a
uniform.”
And in Dorado, a new $107 million hospital facility is under construction by Johns
Hopkins and Dorado Beach Health close to Dorado’s various gated communities to raise the
standard of care on the island. The state-of-the-art facility is primarily for patients from abroad,
but some locals thought it was a good idea as it could encourage talented doctors to return to the
island.
Despite improvements in safety and local amenities in up-and-coming neighbourhoods,
gentrification and displacement remains a common concern for residents. AirBnb is altering the
accommodation landscape. Some homeowners were more interested in transforming their
properties into AirBnbs than selling them or making them available for long-term rental.

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Similarly, in coastal areas, such as Ocean Park, there were many abandoned houses in poor
condition, which some migrants purchased and renovated and then listed on AirBnb. Antares
exclaimed, “Ocean Park is AirBnb heaven!” With fewer abandoned houses, the area looked
better; however, properties became less affordable for local people and those who lived there had
a regular turnover of neighbours rather than benefiting from an established community.
Additionally, new neighbourhood amenities and corresponding prices tended to cater to migrants
and tourists. Andrés commented on Sunset Café, a bar that changed hands in Rincón on the other
side of the island. The new owner increased the prices significantly from $1 to $4 a beer to target
wealthier customers. Similarly, La Penúltima, a relatively new bar in Santurce, offered premium
beverages, such as nitrogen cocktails, and charged close to $10 per drink, far beyond the budgets
of many local Puerto Ricans.
Rule changes
Although Act 20 and Act 22 recipients were grandfathered into Act 60, under Law 40-
2020 the government arbitrarily raised the annual report filing fee from $300 to $5,000, which
amounted to a backdoor tax on individual investors. Many migrants voiced their anger,
disappointment, and frustration at networking events and on social media. Some highlighted that
this was yet another example of government incompetence and corruption and felt that the
government was scamming new arrivals by lying and reneging on promises, which they
considered particularly hurtful as they had already invested a lot of money into the island. Others
were concerned that such a change could force non-compliance further down the line. Neither
$300 nor $5,000 were too onerous for most decree holders, but if the government arbitrarily
increased the filing fee to say $100,000 or any other high enough sum, they could almost
guarantee non-compliance and essentially eliminate all Act 22/Act 60 individual investor

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decrees. James used social media to keep an eye on changes to the programmes and explained
that retroactive law changes could result in him being forced to leave the island since it would no
longer be financially advantageous to stay.
“I think you always know about the changes because the community talks about it on
their Facebook group. The most recent one, the $5,000 fee is not a good thing for sure. In
my case, it’s just another factor to decide whether I will stay. Of course, if I make enough
capital gains this year to pay that and the charity, and pay for the tax preparation, which
is higher than in the States - if it’s still positive, then I probably will stay. At the end of
the year, I’ll see.”
Although many decree recipients could afford to pay for the changes, the broader concern
was a breach of contract, which undermined the stability of all the incentives programmes. One
migrant, who took offence at the amendment, commented that it alters the type of person who is
likely to migrate.
“The interpretation I get is, ‘We want your money, but we don’t want you.’ Because by
doing that, by making those fees higher, they increase the barriers so a scrappy
entrepreneur is not going to move to Puerto Rico. It’s only going to be a really rich
person. But where are they going to go live? Probably in Dorado; so how is that a good
thing? I don’t think that’s a good thing at all. I don’t understand whoever put that forward
and the government here, but yes, it’s just not cool.”
Predictably, the new law was challenged in court. By mid-2021, the lawsuit filed by the
Act 20/22 Society was dismissed, and a second lawsuit, which was crowdfunded by Coalición
De Residentes Por Un Gobierno Integro, LLC, was still under consideration by the Puerto Rican
Supreme Court. Should the rule change stand, anyone relocating for the individual investor

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programme under Act 60 would need ~$20,000 to pay for their first year on the island: (1) $750
for a one-time application fee; (2) $5,000 to accept the decree; (3) $10,000 for the donation; and
(4) $5,000 for the annual report filing fee.
Investment via incentives
Studies suggest the elimination of tax incentives causes firms and business owners to
relocate in favour of a less costly location, and job losses follow (Feliciano & Chen, 2021; Torres
& Caraballo, 2021). Outside investment and increased competitiveness can be attractive to
promote economic growth, but the dependence on industries and companies benefiting from such
tax holidays can ultimately be devastating should the exemptions disappear. Indeed, when
Section 936 was repealed, many firms downsized or left the island. Puerto Rico experienced a
decline in manufacturing jobs and the economy entered a deep recession two years before the
global financial crisis of 2008.
Puerto Rican dependence on the United States was orchestrated from the early days of the
U.S.-Puerto Rican relationship; the 1917 Jones-Shafroth Act triple-tax exemption, for example,
facilitated the island’s excessive debt accumulation through bonds made attractive to American
financial interests. Other laws and policies, including Operation Bootstrap (after World War II),
Industrial Tax Incentives Act of Puerto Rico (1954), and Section 936, highlighted its position as
a tax haven for mainland economic interests.
As blockchain migration was a relatively new phenomenon, some participants
commented that it was still early days for the most recent incentives programmes and that the
positive local impact will be obvious, in time. Jon asserted,
“You’re not going to create these types of opportunities in these environments and then
see benefit the next year. In a decade you’re going to see a totally different Puerto Rico.

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It will be a place that has flourishing employment and a very self-sustainable
environment, agriculturally, economically, all those types of things. […] Give it a chance.
Give it 10 years and then start making some judgments; it’s too early.”
American citizens are taxed on their worldwide income, even if they live abroad. If they
renounce their citizenship, they must pay the enormous exit tax (up to 23.8 percent) on their net
capital gains to the IRS. Therefore, Puerto Rico offers Americans from the mainland the best
opportunity to escape the IRS and the U.S. global taxation regime without renouncing their
citizenship. However, critics note that throughout history, the advocates of many federal tax
policies that shaped Puerto Rico’s economy never supported the island’s best interests; rather,
they supported such policies to exploit and extract economic opportunities (Lourdes Dick, 2015).
These stunted the island’s economic development, positioned it in a perpetual state of
dependence, and ensured it was subservient to corporate interests. Such American domination
over Puerto Rico’s tax and fiscal policies driven by greed, neglect, malice, or indifference
underscore how systems of taxation can enable a complex pattern of economic subordination
(Lourdes Dick, 2015).
Power Dynamics
Many tax incentives are available to anyone in Puerto Rico, not just newcomers. For
example, the Young Entrepreneurs Act (formerly Act 135, but now included in Act 60) offers
incentives to resident entrepreneurs aged 16-35, Act 73 offers tax incentives for the
manufacturing and production sector, and Act 273 (enacted in 2012) provides tax incentives for
banking and financial activities on the island, but only if their clients are located outside Puerto
Rico. With so many incentives, some blockchain migrants suggested that Puerto Rico could
become the Singapore or Hong Kong of the Caribbean, as well as the gateway to Latin America.

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The only decree unavailable to local Puerto Ricans was for new resident individual investors
under Act 22/Act 60; to qualify, individuals must not have been a resident of Puerto Rico
between 1 July 2009 and 1 July 2019 and therefore very few Puerto Rican residents were
eligible. The exclusionary nature of this tax incentive had the potential to fuel resentment on the
island, as it patently served to primarily benefit outsiders. It reproduced privilege and
inequalities, endorsed social hierarchies, and reinforced the “othering” of communities based on
race, class, and wealth.
Giovanni noticed that there was often a greater learning curve for his local clients
compared to his expatriate clients. Local clients tended not to be as knowledgeable about how
the various incentives could apply to them. They often operated under presumptions about what
the law or reporting requirements may be, rather than knowing the facts. Consequently, local
business owners often required more hand holding and guidance on anything that needed to be
taken care of to qualify for the incentives and improve their financial reporting. These disparities
illustrate how differently knowledge circulates within the expatriate and local communities.
Many migrants primarily arrived in Puerto Rico to take advantage of the tax incentives and they
were embedded in dense information sharing networks with each other. Further, the migrants
were accustomed to taking responsibility for their own lives and self-navigating systems and
structures in place. Therefore, they already possessed a lot of knowledge about the tax incentives
before they approached Giovanni for his services.
The minimum wage had remained static from 2009 until 2021 when the Puerto Rico
Senate approved the Puerto Rico Minimum Wage Act, which raised the minimum wage from
$7.25 to $9 per hour (Clemente, 2021). Expatriates could make their fortunes on the mainland
and then relocate. Comparatively, most Puerto Ricans were born into relatively underprivileged

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circumstances, with limited local opportunities that often paid a third of the salary of the United
States. The less educated local population typically worked in hospitality or tourism or worked
for the migrants as cleaners, chefs, or gardeners. Most blockchain migrants enjoyed much larger
incomes than most locals and thus they held a unique position of power. In this research, for
example, most were earning at least six figures annually. Giovanni could command significantly
higher fees after building his reputation in the industry by acquiring well-known clients, doing
interviews with prominent publications, such as the New York Times, and by starting his own
law firm that specialised in tax law, that served many clients in the Act 20/22/60 community.
About a third of his clients were blockchain migrants. Although Giovanni directly benefited from
blockchain migration, many locals saw little, if any, direct economic benefit. One Puerto Rican
individual expressed concern that if all the bilingual and educated Puerto Ricans leave the island
in search of better-paid jobs with greater opportunities for career advancement, the only people
living in Puerto Rico would be poor and uneducated Puerto Ricans alongside wealthy
Americans.
Few blockchain migrants spoke Spanish, and those who were bilingual had to familiarise
themselves with the strong Puerto Rican accent, slang, and pronunciation. Monika observed,
“There’s so much slang. Puerto Ricans will intentionally up the amount of slang to make
sure you don’t understand them if they want you to not understand them. Some of the
pronunciation differences are like, ‘Wait, what’s that?’ You have to turn some things into
different sounds. You can’t go by your Mexican Spanish. You can’t pronounce all your
S’s. There’s just things like that.”
Kyle concurred,

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“I wanted to go to this local butcher. Man, it was so hard because he could understand
everything I was saying, but I had no idea what he was saying back to me. After a while,
I got used to his accent though, and I could figure it out, but it is so different for sure.”
Several migrants took Spanish classes at the Universidad de Puerto Rico (UPR) or local
language schools to further immerse themselves in the culture. However, this was not the norm
as learning the language was perceived to be difficult, especially because everybody in the
blockchain migrant community spoke English. As Jennifer explained, “Even the Puerto Ricans
who are part of our crew, all speak English.” Thus most blockchain migrants could not integrate
fully into Puerto Rican society and culture, but English-speaking Puerto Ricans could integrate
into the blockchain migrant community, if they wanted to.
Power is often associated with lack of constraint. The relative affluence and privilege that
blockchain migrants had in relation to the local Puerto Rican population generally afforded them
the freedom to live their lives as they wanted and to take on more risk than the average
individual. Beyond their economic advantage, their relative power stemmed from access to
material, symbolic, cultural, and political resources related to the United States (Croucher, 2009).
Their socioeconomic status was distinct from that of local Puerto Ricans and the U.S-Puerto
Rico colonial relationship only heightened the relative positions of privilege and power. Their
experience of everyday life in Puerto Rico was different to many locals as they typically lived in
coastal areas, away from much of the poverty that existed inland. Yarey, the director of a local
Taíno educational non-profit, commented on how some migrants were prioritising relationships
with senators and wealthy people over the locals who were “in need” especially when many
locals had struggled to cultivate such relationships with influential people. Further, she noted that
many newcomers lacked awareness about the reality of life in the more deprived areas.

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“I never thought we were first world, but I get to see these children in these communities,
and I know damn well we’re not first world. […] You need to really get in with the
people, feel their poverty, feel their pain; know there’s a lot of stuff in Puerto Rico and
you could help. […] You don’t have to speak Spanish to see the poverty. If you have
awareness, you would know. With a few words, you would know what’s going on when
you see their homes, open the refrigerator, see the blue roofs, see them bedridden. Just
look and see; you don’t need an interpreter.”
Such observations draw attention to the social hierarchies embedded in, and reproduced
by, migration practices brought about through tax incentives and migration networks. The
position the blockchain migrants occupied alongside the access to resources not available to the
local population were stark reminders of the relative social and economic privilege of many of
the migrants and the inequalities perpetuated through and embedded within the broader social
structure in Puerto Rico. The establishment of formal organisations aimed only or primarily at
the migrant population, and go-to individuals or companies for legal, medical, and other services,
reinforced the systemic and invisible power structures on the island. These unequal power
relationships were also reflected through discriminatory laws and practices (e.g. not permitting
Puerto Ricans to benefit from the tax incentives for individual investors), along with the
privilege and symbolic representation of the United States embodied and enacted by most
migrants through their agency and choice in their daily lives, which reinforced the U.S. image as
a colonial power.
Cultural differences and contentions
In addition to business challenges, which tended to be brought about by attempting to
operate in an unfamiliar cultural setting, migrants experienced discomfort due to their lack of

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acquaintance with local customs or norms. Entering a new culture where familial cultural cues
are irrelevant can cause frustration and confusion (Ferraro & Briody, 2015). The nature of the
cultural discomfort experienced by blockchain migrants generally revolved around the
bureaucracy pertaining to many aspects of day-to-day living. Kyle others spoke about the
struggles they faced in obtaining a local driver’s licence, a requirement that helps to satisfy the
closer connection test under Act 22/Act 60. Kyle described his ordeal,
“The driver’s licence process almost was the death of me because I unfortunately applied
too late, right after they instituted this mandatory driver’s course. There’s an alcohol,
drug safety course that you had to take. It’s just a money-maker for the state, but it took
from when I started the application, maybe four months to get my driver’s licence. There
was just so many delays; it is very nonsensical. In the United States you just go to the
DMV, the Department of Motor Vehicles office and everything is done there. It’s very
straightforward. You get your picture taken. You answer some questions, background
check, whatever, and you’re good to go. But then here, the difficulty was that a lot of the
different components you had to fetch from a lot of different areas. Then with the driver’s
course, there was a huge waiting list and it was only offered on certain days of the month.
I’ll spare you most of the horror stories, but that thing should have taken maybe half an
hour ends up taking three hours because for some reason the teacher took so long taking
attendance and then he was just standing there reading off index cards. It was very
backward. So I think it was just to make money because you must pay for it as well. In
the end for the driver’s licence, I finally broke down and used that very popular service
from Licence & Co. because honestly, to get in touch with the right people to take
everything together, it would have been just way too difficult. They’re supposed to help

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you skip the line, but really they just helped you set up the next step. It was easier
because they would just tell you what to do, whereas I looked so long online. There was
no clear-cut process that I could just go through. What they did was, for instance, they
would just take all my information, submit it to the right people and come back and say,
‘You need to go here to get your picture taken.’ I just follow them around. I was just like,
‘Lead me to my driver’s licence.’”
Adjusting effectively to the Puerto Rican way took time. Many migrants employed local
expeditors such as Licence & Co to help them navigate complex local systems. The expeditors
tended to have positive relationships with appropriate staff members speed up the process.
However, attention to detail was often lacking, and expeditors and other employees regularly
made errors. Such services were frustratingly described by one migrant this way, “It’s a
concierge where do you do the work still.” Although, Puerto Ricans were seen as not very
diligent, the time saved was often significant and worth the cost.
Most migrants rented property, at least initially; however, finding a suitable place to live
was not always easy. Many properties had broken fixtures and fittings and realtors were not
always honest in telling potential tenants about the issues. James had lived in several apartments,
and they all had problems, which he often fixed himself. His first apartment had leaks under the
sinks and fridge, and the bed was rotten underneath and ready to collapse. He believed that he
overpaid, but he took some of the blame for the problems as he only looked at the apartment over
FaceTime prior to moving in. Many landlords also tried to keep security deposits, or were slow
to make refunds.
Noise was a common complaint, with one migrant asserting, “People seem to lack the
common courtesy as in the States.” Depending on the neighbourhood and/or building,

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neighbours, cars, or people on the street below would often blast reggaeton music through the
night, disrupting the sleep of anyone living in the area. Monika moved apartments within a
month because of the noise from a local gas station on Calle Loiza. Another migrant in the same
building described a night when an individual had decided to set up and play a drum kit outside
the gas station at 3am. Monika continued,
“I realised that being across the street from that gas station, and in a very loud party strip
of the city, was not my vibe at all. With these windows that are single-pane, thin and
don’t completely shut, it’s just extraordinarily loud, as you can hear small bird sounds
outside; you can hear absolutely everything. I have not slept well. It drove me a little
mad. I decided I just had to move no matter what, even though I signed a six-month lease.
I would pay anyone my whole deposit for the chance to sleep for six months.”
Subsequently, Monika found a subletter for her place and found new accommodation; however,
as was common, her new apartment needed work, so she helped her landlord paint and improve
the place. Well-connected migrants often had a smoother moving experience. They could draw
on their networks to find suitable accommodations. Some had the opportunity to live in unused
properties belonging to friends who left them vacant while travelling. Even though some
migrants had housing issues, their ability to adapt by quickly relocating again, after moving in, or
promptly fixing anything broken or worn out, demonstrated their agency and financial capacity
to organise their lives comfortably.
Migrants quickly acclimatised to the perceived lack of rules and/or enforcement in Puerto
Rico compared to the United States, which some believed enhanced their freedom and choice.
Home schooling was popular among migrants with families as they could educate their children
without government interference. Popular bars and nightclubs stayed open and served alcohol

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until at least 4am. Moreover, red lights and stop signs were often ignored. Drivers were legally
permitted to drive through red lights between 12am and 5am, to mitigate carjacking concerns. On
the mainland, migrants were prohibited from drinking on the beach, unlike in Puerto Rico. One
migrant noted,
“If you don’t have some kind of alcohol at the beach, something is wrong with you.
Culturally, they’re like, ‘How could you be enjoying yourself?’ Everything here is about
enjoyment. Family and enjoying yourself takes precedence over work and making
money.”
The more relaxed legislation and enforcement around life activities were generally welcomed by
migrants, as it complemented the relative freedom and flexibility they sought in their overall
lifestyles.
However, the absence of any rules in other areas was frustrating. The lack of care for the
environment was a common criticism. Recycling was uncommon; recycling trucks visited some
more affluent areas every two weeks, but even then, it was unclear where the waste went. Some
migrants believed that all trash ended up in the same place anyway, making any recycling efforts
futile. Individual vegetables were often wrapped in cellophane in the supermarket and plastic
trash was often dropped on the floor in public places. Some beautiful beaches, riversides, and
lakes were polluted with plastic waste and other litter. Several migrants questioned whether the
Puerto Ricans just did not know about recycling or the environment or understand the labour and
energy that went into making products prior to consumption; and maybe there was a need for
local education around the issue. The lack of universal principles and values in relation to
environmental perspectives highlighted the disparities between the communities. Concern for the
environment is often correlated with socioeconomic status (Pampel, 2014) and as most Puerto

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Ricans were relatively poor, with fewer resources, compared to the new arrivals, the environment
may not have been their priority.
Although appreciated in some parts of island life, the relaxed attitude of law enforcement
was a worry. Several high-net-worth migrants were nervous about personal safety and were
especially angry when the local government decided to publish the names of all Act 22/Act 60
beneficiaries on its website as this could make them targets. One participant lamented,
“There’s a lot of violence here. Somebody kills somebody; they’re not going to figure out
who did it, or they’re not going to investigate it anyway. There’s a whole part of this
town run by organised crime where the cops don’t even go (La Perla). It is ridiculous. For
a place where something like that can happen, for them to be taking people that they
basically said, ‘Hey, come here, we’re going to give you this incentive’; for them to
advertise who these people are, that’s not okay. Maybe there’s things published about
politicians here in Puerto Rico. Maybe we should publish all their tax returns. Maybe we
should publish their home addresses. How is it okay for them to publish our information?
I think that’s also an anti-gringo sort of thing. You can’t say on one hand, ‘We want to
have investors’ and on the other hand, we’re doing things against them.”
Migrants felt discriminated against because of their status as they were the only group on
the island to have their private information published online without consent. Other than medical
professionals benefiting from Act 14, it was individual investors that were listed (including their
name and the date their decree was requested and approved), and not those who had benefited
from any of the other tax incentives (business names were publicised on lists relating to other
incentives). Blockchain migrants valued privacy and had no interest in being made into public
figures. One participant recalled a time when a migrant walked into a building and some local

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Puerto Ricans recognised and threatened them. Subsequently, social media was used to publish
untrue and maligning content about that migrant. Thus, participants commented that they needed
to have a different level of vigilance about their surroundings if they were no longer anonymous.
One migrant asserted, “These are private citizens and private citizens have a right to privacy.” If
something awful were to happen because of that list and the safety of decree holders was visibly
under threat, it could cause return migration and thus the removal of capital from the island
economy.
“Now these people are going to want to get on the plane and leave. You’ve (the Puerto
Rican government) just ruined it because you had somebody here who’s doing good,
participating in the community, reaching out and doing volunteer stuff and quietly
participating. Now you’ve just made it unpleasant for this person to be here. To what
end? Just because you don’t want them here? Well, then just be racist and say, ‘You don’t
want them here.’”
It was not understood why the local government would want to publish the names of the
tax decree holders. Migrants believed that most of the local population would probably have no
interest in the list, but anyone who wanted to find out who the individual investors were,
probably would have bad intentions. If there was a real benefit to publishing the list, it was
suggested that the government should print it and make it available in a government office where
people needed to travel to access it, rather than making it easy for individuals to download and
cross reference with social media and other online forums, turning individuals into a target for
harassment, or worse. Blockchain migrants also believed that if the government continued to
publish information about the decree holders, then they should ensure fairness and transparency
across the board by publishing the information of everyone who works for the government,

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including contractors. Of course, the likelihood of this happening was slim, due to institutional
government corruption, which was another source of contention for the migrants.
Media backlash and graffiti opposing incentives for individual investors and the new
arrivals were commonplace (Figure 5.7). Better-known decree beneficiaries such as Brock Pierce
were singled out and heavily criticised by journalists and on social media. Such criticisms were
not limited to the blockchain migrants as other well-known expatriates such as social media
influencers and boxers Logan and Jake Paul and stockbroker, financial commentator, and gold
enthusiast Peter Schiff had also been targeted.

Figure 5.7. Protest graffiti in San Juan, a popular location for migrants to live
Rather than criticising the systems in place that brought about the economic development
strategies and incentivised certain groups of people to relocate to the island, migrants were often
heavily criticised by local, mainstream, and social media and labelled as colonisers. A local

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female artist called myartisnotpolitical on social media condemned the newcomers as “crypto
colonizers” with a “white saviour attitude” who were “taking over” the island. Other posts in the
series used the photographs of four well-known migrants, accompanying the text, “This is what a
colonizer looks like” (Figure 5.8). Social media accounts such as abolishact60 (Abolish Act 60)
and brincacharcopr (Brinca Charco) actively promoted independence and the abolition of the tax
incentives. Local influencers also posted videos about the impact of the migrants on the Puerto
Rican community. Bianca Graulau’s online video about the wealthy newcomers - Rich people
are moving to Puerto Rico and some Puerto Ricans are not happy about it - accumulated over
250,000 views and quickly became her second most popular video on YouTube. It described the
displacement and segregation of Puerto Ricans and the gentrification of certain locales that were
benefiting from economic investments. It also criticised the Act 20/22 (Act 60) tax decrees, and
especially the individual investor incentive. The reporting appeared balanced and fair, but Bianca
overlooked the financial crisis and other systemic issues that caused the government to enact the
tax incentives. She also did not explain that Act 60 had replaced both Act 20 and Act 22 and did
not mention that Puerto Ricans could qualify for Act 20 (Act 60), or that qualifying individual
investors under Act 60 must donate $10,000 to charity every year and buy a house. Also left out
was that newcomers paid other taxes, such as sales tax, like everyone else, and that many local
businesses had benefitted from the influx of capital. Although her reporting was not sensational
in tone, these oversights undermined the value of her video as the complexity of the situation
was not fully addressed. Such omissions were typical of mainstream and social media.

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Figure 5.8. Social media art by myartisnotpolitical
“Media throwing rocks at gringos” Ghost noted, tended to be prompted by one misstep
by an individual migrant, “It takes 100 good guys minding their own business doing the right
thing and it takes one idiot to take those other 100 guys and make them look like the same idiot.”
Indeed, award-winning American journalist David Begnaud, was quick to pounce on any story
that portrayed migrants in a bad light (all migrants in Puerto Rico, not only those in the
blockchain space). Articles such as Puerto Rico Act 22 Tax Incentive Fails in a Puerto Rican
media outlet called Centro De Periodismo Investigativo (Center for Investigative Journalism
(CPI)), were completely biased negative hit pieces. They criticised the newcomers and
highlighted several “bad apples” in an attempt to tarnish the whole community. A small number
of articles such as Influencers, Developers, Crypto Currency Tycoons: How Puerto Ricans Are
Fighting Back Against the Outsiders Using the Island as a Tax Haven in Time Magazine were
more balanced. They considered the wider social and economic structures at the macro, meso
and micro levels; but still, reporting was typically biased against the migrants themselves.
Annie believed that any criticisms in the press and negative public perception stemmed
from extremes on both the Puerto Rican and the migrant side, as hostile exchanges were shaped
by fringe subgroups in both communities. David noted that positive press probably would not
sell very well. Migrants voiced their frustrations on WhatsApp and other social media platforms

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about the bias against them in the press coverage. They felt that they were poorly represented
and disrespected, after they had invested capital, resources, and energy into the island. David
assumed some of the negative coverage stemmed from a lack of clear reporting to the local
population about benefits brought to the island by the new arrivals.
“There’s usually some controversies because of the blockchain groups here in Puerto
Rico. A lot of people might not be welcoming of change or new things that are coming
here. When the blockchain community was first developing, everything is great and the
press is great, but later, you can see questions arise, ‘What’s happening with the
community? Is it good? What are they bringing?’ There are people that are always
sceptical of what is happening, ‘Are they bringing good things, or are they here to extract
what they can and leave us with less than what we already have?’”
For the media, the migrants symbolised a continuation of the economic exploitation of the local
Puerto Rican population. This sentiment was replicated on the ground and online by local
activists; however, these views were generally limited to the more vocal and organised groups.
After Hurricane Maria, CryptoMondays helped reopen Poet’s Passage in Old San Juan, a
coffee shop and poetry gift shop with open mic poetry. Power was out for four months after
Maria struck and the owner, Lady Lee Andrews, did not have the money to fix the damage, pay
her bills, and reopen. Pedro from CryptoMondays and his network offered to help her reopen.
“The cafe was beautiful with space. Everything there worked. It just needed a little bit of
money; traffic to really get the business back off the ground. We basically agreed to open
the cafe and worked there for seven weeks for free. […] My thing was just helping drive
traffic through the door, helping with promotions, the business side of things, helping her
with her books. My initial concept was to use CryptoMondays as a fundraiser for this

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business to get it back off the ground after Hurricane Maria, plus, every Monday, having
the meetups there. The Poet’s Passage has a beautiful stage that’s available for basically
presentations or concerts or performances or whatever the case may be.”
Consequently, CryptoMondays began at Poets Passage and the group raised money for
the business. However, Lady Lee Andrews and the blockchain migrants experienced resistance
from the local Puerto Rican community, which intensified after Brock Pierce, who was receiving
bad press at the time, participated in a fire-side chat with Lady Lee Andrews. As Pedro
explained, the owner “received a ton of flak on the internet…
“…People disrespecting her, screaming at her in the streets; talking about how she was
facilitating people who were buying up Puerto Rico, and she was selling her country. She
was a sell-out essentially to some. All we were doing was just trying to help the lady,
honestly, bottom line. The money we raised there was all donations; not to mention the
people that we were bringing through the door; people spend every week.”
Due to the controversy, CryptoMondays found another venue to host their weekly events. Pedro
viewed his involvement with Poet’s Passage as an unquestionable good; however, his efforts and
the local response made visible the structural and systemic inequalities between the migrants and
the locals. Pedro saw a local need and wanted to help contribute in some way, but the embedded
power inequalities reproduced colonial relations (though, interestingly, Pedro himself is actually
“Nuyorican”, a Puerto Rican born in New York).
While infrequent, migrants were sometimes verbally harassed from outside
CryptoMondays venues. During the Ricardo Rosselló protests, local demonstrators yelled into
the Red Monkey bar where CryptoMondays was taking place, “Shame on you!” and “This is our
country; you’re not going to fucking take it!” and at another event, a smaller protest took place

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on the sidewalk outside where protesters were yelling “Pay your taxes!” and “Gringo go home!”
Justin heard protesters shouting, “Gringo go home!” outside his front door during the Ricardo
Rosselló protests, though he recognised that such resentment stemmed from “a very small sub-
section of the population.” He continued,
“Everybody that I’ve personally met here have been the most amazing people. I moved
here because of the people. I don’t understand the hatred. […] I had a conversation with a
woman about the resentment, and she’s like, ‘We don’t need no white saviour.’ I’m like,
‘Are you serious? I’m not trying to be your saviour; I’m trying to help people.’ She didn’t
see it like that. This is after 500 years of colonialism; they’re sick of white people. I’m
trying. I just want to help.”

Figure 5.9. “Go Home Gringo” graffiti on the Departamento de Estado (Department of the State)
building, in Old San Juan during the Ricardo Rosselló protests
By comparison, Nico, who lived in Puerto Rico but held French citizenship, commented
that he hadn’t felt this kind of resentment because he did not “feel the same historical
judgement”. Valaria believed much of the recent bitterness stemmed from how the U.S. handled

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the aftermath of Hurricane Maria. Puerto Ricans assumed that Washington wasn’t helping, but
significant aid was unable to reach the island or its people, which became evident when
warehouses of unused supplies were discovered almost three years later (Romo & Florido,
2020). Local businessman Andrés Rúa also observed the historical context. Some local Puerto
Ricans made much noise to protest the “gringos” on the island; however, Andrés didn’t believe
that frustrations with American migrants on the island were grounded in reality but arose from
the history that had accompanied their migration.
“I think that this is important to point out. When we got out of Spain, we were going to
start our own country. But anyone could invade us with the [small] army that we used to
have then. The people don’t understand that we were vulnerable. The United States
invaded us, and they came to help us to protect our land. Okay, let’s protect the land until
we become independent, and Puerto Rico can do it on its own. […] Cuba had an army;
they were able to declare independence but in Puerto Rico, we were not organised.
Remember I was telling you the people did not even have shoes. Sugar cane was the
thing, and they didn’t have guns. We were not like Cuba, who was more prepared than
us. Anyway, the thing is that when all that happened, Spain said you’re free, the United
States came, saying that we are the masters now and you are a bunch of people in the
mountains, so let me help you.”
Many residents seemed to forget, or did not know, that the Americans encountered little
resistance when it “liberated” the island from Spanish colonial rule. This is important to
acknowledge as it set the stage for the events occurring on the island today.
There were many cultural challenges for the blockchain migrants and the local population
to overcome. Such experiences can facilitate learning and lead to self-awareness and personal

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growth. Migrants also acquired new knowledge and skills, which helped them to become more
aware of their cultural heritage (Ferraro & Briody, 2015). Despite some difficulties adjusting to
major differences in lifestyle and practices, many migrants really appreciated the Puerto Rican
culture. It was vibrant, colourful, and rooted in enjoyment. Loud music, singing, and dancing and
the overall party (“fiesta”) vibe, which often spilled into the streets, were key threads in the rich
cultural tapestry of the island. Justin appreciated the distinct approach to protesting on the island;
these events were more like fiestas with marching, dancing, singing, and drumming. Kyle
especially enjoyed the dancing.
“People are very, very friendly, people are singing and dancing. I walked out of the
university, and there’s people actually dancing like salsa or bachata; you would never see
that in an American university.”
Strangers would approach other people in restaurants and cafes, kindly saying “buen
provecho”, which roughly translates to “bon appétit”, to wish them an enjoyable meal. Monika
also adored how friendly the local community was towards her; however, even in her short time
on the island she could feel the prickly undercurrents stemming from clear inequalities in
opportunities and resources and recognised that she was the embodiment of such disparities.
“I can’t tell you how polite so many Puerto Ricans have been, how wonderful and
awesome. This culture is amazing, but I can feel there is an undertone too, of just this
real, tired of being tread upon feeling. I’m the face of that, which makes me really
motivated to try to do something that hopefully a lot of our community can get behind.”
Chapter Conclusion
In addition to market fluctuations and migrant networks, blockchain migration is shaped
by rapid technological developments in the blockchain ecosystem that further complicate tax

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compliance requirements. Although the incentives were effective in attracting capital, talent, and
ideas to Puerto Rico, pioneering use of Puerto Rico’s tax system for blockchain enterprises had
the potential to generate more capital that could be reinvested to encourage further innovation
and growth. The island’s small size facilitated regular face-to-face contact and information
sharing among investors and between investors and entrepreneurs, which enabled trust building
between the parties. Migrant flexibility and agility and the decentralisation of entrepreneurial
labour created an environment conducive to new businesses, other initiatives, and community
offerings, and ultimately innovation. The brain gains from such migration provided an
opportunity for Puerto Rico to become an industry leader in blockchain technology because of
the concentrated knowledge base being cultivated on the island. The production and transfer of
this knowledge via community gatherings and educational programmes, like those offered at the
Holberton School and the Blockchain Education Network, could help close the blockchain skills
gap and retain talent for well-paid employment opportunities, and provide Puerto Rico with a
huge competitive advantage.
However, the local environment was not always conducive to such developments.
Government red tape, regulatory uncertainty, and unreliable infrastructure slowed innovation and
growth. Migrants were locked out of the local banking system due to their involvement in the
crypto space, which was often their principle economic activity and “island time” could be
frustrating as deadlines were frequently not met, and appointments started late.
Some migrants had the belief that they were purposefully slowed down as Puerto Ricans
wanted their money but didn’t want their physical presence. Migrants were annoyed that they
had to retain a different level of vigilance about their surroundings due to the individual investor
Act 22/Act 60 list of qualifying individuals being published online without their consent.

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Retroactive changes to the cost of the annual report filing fee represented the incompetence and
corruption within the local government, and made the migrants feel disrespected as they had
already invested a lot of money into the island. The media influenced public perception and
further exacerbated the cultural distance by sensationalising how the migrants were portrayed
and ignoring the complexity of the situation, and the structural conditions that shaped such
movement that ultimately stemmed from a contentious colonial past.
The cultural distance was further shaped by structural and systemic inequalities in
relative wealth, and social and economic power. The discriminatory exclusion of the local
community from the individual investor Act 22/Act 60 was a key point of contention. One-way
integration because of the migrants’ general lack of bilingual language proficiency had the
potential to cause cultural erosion. The local community witnessed changes and tangible
improvements to towns and cities popular with the migrants, such as upgraded amenities,
services, and retail establishments that catered to the tastes and values of the newcomers.
However, the cost of accommodation and local services in towns and cities popular with the
migrants increasingly exceeded the budgets of many Puerto Ricans. Moreover, a small number
of migrants were visibly cultivating relationships with senators and influential people, which
irritated some locals as they had struggled to develop such relationships.
Despite these challenges and cultural contentions, most migrants appreciated how
welcoming and friendly the Puerto Ricans were overall. Both Puerto Ricans and the migrants
were generally incredibly respectful and polite towards each other. Hostile disagreements were
typically shaped by the minority, situated on the fringes of both communities. Annie observed, “I
think they have been attracting each other.” It should be noted, however, that positive
interactions greatly exceeded the negative between the groups.

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Chapter 6 brings together the key tenets of blockchain migration in Puerto Rico,
highlighting the cultural practices and consequences of such migration.

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Chapter 6 Migration Futures and Broader Impacts
“Act 20 and Act 22 [and more recently Act 60] have brought some blockchain people
down here; they’re not transforming Puerto Rico. The answer is not because they
wouldn’t want to or be happy to. It’s that Puerto Rico is not particularly interested in
being transformed. They seem to be blissfully miserable with the system that they have,
whatever that system might be.”
--Ghost
This study highlights the relationship between culture, digital knowledge,
entrepreneurialism, and the ability to migrate. It tackles lifestyle migration and the wider
adoption of blockchain technology within the context of two highly topical issues: (1) COVID-
19 and (2) the 2020-2021 crypto bull market. A favourable tax regime and new mobility
processes brought about by policies surrounding the coronavirus pandemic and the new wealth
created by the crypto bull run produced the structural conditions that enabled those affected to
relocate to desirable locations that supported their lifestyle choices. This thesis purposefully
represents a departure from previous blockchain-related migration research (Crandall, 2019;
Howson, 2020; Jutel, 2021). Instead of being situated at the more abstract macro level and
mainly looking at settler colonialism, computational capitalism, or sustainable development, it
provides on-the-ground profiles and explores migrants’ lived experiences. Its findings may be
pertinent to other locales that encourage similar migration through government policies that
encourage economic growth via foreign investment and innovation.
The little-known story of blockchain migration to Puerto Rico illustrates unanticipated
migration patterns resulting from government policies that target economic growth and
development. After many investors profited from the 2017 crypto bull run, Brock Pierce and the

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New York Times article about the crypto community in Puerto Rico became catalysts for a surge
in blockchain-related migration in 2017-2018. Increasing numbers of blockchain migrants were
lured to Puerto Rico to take advantage of the more advanced blockchain infrastructure and
community during the subsequent bull run that started in 2020 after the bitcoin halving. Many
were pushed from American towns and cities due to pandemic-related lockdown rules and other
regulations and took advantage of the opportunity to work remotely. Concern over the
Democrat’s tax proposals prompted individuals to escape the high-tax states of California and
New York, especially.
For many who arrived in 2021, migration was not on the agenda; they visited the island
for meetings or to see friends. After being embraced by the sizable vibrant blockchain
community and impressed by the “intellectual orgy” occurring on the island, they did not want to
leave. Instead, they sought to plug into the existing community to work on exciting and
innovative projects. This demonstrates that networked or chain migration doesn’t only apply to
people from low socioeconomic backgrounds. Network theory is also applicable to privileged
blockchain migrants, but their resource levels are different. They participate in powerful personal
and professional networks, comprising established migrants with considerable financial and
social capital who can aid their decision-making process and help them adjust personally and
emotionally after arriving. In addition to low taxes and good weather, the blockchain migrant
community itself became part of the lifestyle that Puerto Rico offered to newcomers, due to its
concentrated and accessible knowledge base.
Many who moved in 2021 were enticed by the benefits of joining the blockchain migrant
network rather than the tax advantages. However, keeping track of and calculating taxes for
thousands of annual crypto trades made on multiple exchanges and platforms can be a serious

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administrative challenge and so the Act 60 individual investor programme was still a significant
factor as it simplified the crypto tax reporting process. Some migrants spent funds annually
specifically to remain in compliance with Act 22/60, but the costs outweighed the benefits as
they were not selling their assets and therefore not incurring any capital gains.
Blockchain migrants were not considered in the initial drafting of the tax incentives. The
Puerto Rican government probably expected their policies to entice migrants with more diverse
skillsets. They did not plan for or intend to attract such a highly specialised knowledge base; yet
the push and pull factors that evolved created the perfect conditions for this migration to occur
and accelerate, and consequently these migrants became a prominent feature in the island’s
economic and competitive landscape.
Building on research by Young (2017) on tax-induced migration, who asserts that few
millionaires migrate for tax advantages as they are typically mature and established with a
family, blockchain migrants in contrast are predominantly in their 30s, single, and wealthy; they
represent a different demographic of affluence and so are incredibly mobile. The featured
narratives underscore the relative freedom and choice enjoyed by blockchain migrants brought
about by increased control over normative conceptualisations of time. Most were self-driven
entrepreneurs, who were tech-savvy, naturally optimistic, and less risk-averse than the general
U.S. population. They did not “fit into the Midwest cubical lifestyle”. On the “Island of Misfit
Toys”, they pursued a way of life distinct from mainstream societal expectations and most
institutional influence. They often employed practices that aimed to avoid external and internal
forms of dependence, in relation to formal employment or state institutions, to attain material
comfort, security, and freedom. Akin to those depicted in Apple’s 1997 Think Different
campaign, they were changing the world and perhaps even pushing humanity forward via their

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pioneering ideas and projects. Their hacker ethic, Californian ideology, and entrepreneurial spirit
combined to create a melting pot for innovation, replicating the San Franciscan mentality of the
1960s and beyond. The island attracted individuals who had manoeuvred their lives to achieve
flexibility and choice. Like blockchains, these self-driven and optimistic migrants employed
decentralist values as they utilised their own resources to operate within and around the
centralised systems in place.
Social media and messaging applications, such as Telegram, Facebook, and WhatsApp,
facilitated the development of personal and professional networks on the island. Moreover,
distinct from a large city environment, the density of the blockchain migrant population,
especially in the San Juan metro area, helped to bring together eclectic brain power, talent, and
unique capabilities effortlessly and regularly through events, activities, and festivities, and
enabled migrants to obtain easy access to prominent individuals in the blockchain ecosystem.
The collective ethos was much like a university setting, with abundant social gatherings leading
to brain fusions among the migrant community; although some migrants noted that they had to
pace themselves as having a packed social calendar could sometimes be overwhelming and cause
them to lose focus on their personal priorities.
The preferential capital gains treatment given to investors on the island helped start ups to
raise capital and benefitted those willing to take entrepreneurial risks. The island’s small size
further facilitated regular face-to-face contact and information sharing among investors and
between investors and entrepreneurs, which enabled trust building between the parties. Thus, the
tax decrees, combined with high-tech companies, talented entrepreneurs, and a narrow
geographic area created an environment ripe for venture capital investment.

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Mass collaboration, open innovation, and co-creation facilitated free inflows of creativity
and knowledge. Many migrants had accumulated broad experience in diverse industries, and they
used it to plug into multiple projects, activities, and companies that they found interesting, by
consulting, investing, or building. Migrant flexibility and agility and the decentralisation of
entrepreneurial labour created an environment conducive to new businesses, initiatives, and
community offerings, and ultimately innovation. Nimble start-ups embraced blockchain
technology and some were challenging legacy businesses and organisations. Nico, for example,
was looking to compete with the Puerto Rico Electric Power Authority (PREPA) - later handed
over to the private company Luma Energy - by developing a more efficient, sustainable, and
resilient energy system using microgrids and the Ethereum blockchain. Disruptive decentralised
innovations such as blockchain-based community microgrids had the potential to lower prices,
improve reliability, and provide a higher quality service for Puerto Rican residents. Although
blockchain innovations that had the potential to disrupt the local market and positively impact
the lives of island residents were rare. Business operations were typically international in nature
as Act 20/Act 60 focused on export services, due to government concerns about the possibility of
unwanted local competition.
The production and transfer of blockchain-related knowledge between and among the
community members was facilitated by a highly geographically localised community and regular
informal social gatherings. While blockchain knowledge diffusion via entrepreneurship can
facilitate economic activity and growth, such diffusion among the local population was occurring
relatively slowly. The blockchain skills gap is an issue and challenge as the industry is growing,
and certainly isn’t unique to Puerto Rico. Educational programmes like those offered at the
Holberton School or the Blockchain Education Network can help close the skills gap and retain

234
talent for well-paid employment opportunities on the island. While blockchain migration has the
potential to encourage further dependency on the United States, it may also set Puerto Rico on a
path to modernisation and national development, which ultimately could reduce both
unemployment and the out-migration of talented Puerto Ricans in search of better-paid work on
the mainland. Indeed, the average salary for jobs created by new businesses that applied for tax
decrees between July 2020 and June 2021 was $66,000. The brain gain from such migration
provides an opportunity for Puerto Rico to become an industry leader in blockchain technology
because of the concentrated knowledge base being cultivated on the island.
Although the culture of San Juan was increasingly a culture of innovation and
entrepreneurship and the local business environment had major potential, somewhat
paradoxically, the government corruption and excessive red tape made it challenging for
migrants to conduct business and invest in the island. For example, the local banks’ refusal to
handle crypto transactions, which was the principle economic activity of many of the migrants,
made it difficult to open a local bank account to help satisfy the closer connection test aspect of
Act 22/Act 60. On the other hand, Puerto Rico offered significant tax incentives for international
banking entities (IBEs) and international financial entities (IFEs), some of which were involved
in the crypto sector; however, residents (including resident expatriates) were not permitted to be
clients. While Act 60 explicitly included blockchain-related services as qualifying business
activities and cryptocurrencies and other crypto assets as eligible for tax exemptions, blockchain-
friendly regulation lacked in other areas. Many migrants cited Wyoming’s 2018 and 2019 laws
as being far more conducive to blockchain-related business activities and wanted Puerto Rico to
adopt the same the legal clarity. “Island time” tested the patience of new migrants, and they
became frustrated when deadlines were frequently not met, and appointments started late; though

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eventually many migrants adapted to the slower pace of life. Regular power outages and damage
to vulnerable infrastructure caused by natural disasters, such as earthquakes and hurricanes, also
presented challenges to business continuity.
Trust and relationships were fundamental aspects of the Puerto Rican culture. The
migrants had to adapt to the distinctly different way of doing business in Puerto Rico compared
with the more merit-based American system. Personal reputation was valued higher than
expertise and individual skillset. Comparable to the local community, blockchain migrants
generally concentrated on getting to know each other first through social events and activities,
and then later progressed to a more professional relationship. However, opportunities to integrate
and listen to the needs of the Puerto Rican community were often missed primarily due to the
one-way integration and the language barrier.
Most migrants did not speak Spanish. The ratio of expatriates to locals tended to be
slanted towards the migrant audience at events and activities popular with blockchain migrants,
such as CryptoMondays, possibly due to local scepticism and because they were often only in
English. Migrants tended to live and socialise in the urban and coastal areas away from the
Spanish-only speaking mountainous regions. Local bilingual Puerto Ricans who had
[intentionally] associated with the blockchain migrant community had generally benefitted from
knowledge transfer and business opportunities presented to them through the network. Such
practices illustrate the power dynamics and relational inequalities between the migrants and local
Puerto Ricans.
Processes of globalisation can cause cultural convergence. If Puerto Ricans continue to
leave the island in search of better opportunities, and relatively wealthy expatriates continue to
migrate to the island, and one-way integration persists, severe cultural erosion may occur. In the

236
future, there is a risk that the only people living in Puerto Rico will be poor and uneducated
Puerto Ricans alongside wealthy American migrants from the mainland. Puerto Ricans take great
pride in their rich, vibrant culture and roots. Blockchain migrants would benefit from learning
Spanish to better acculturate themselves to Puerto Rican society, better understand local customs
and traditions, and enhance their professional position on the island. Two-way integration would
narrow the cultural distance and enable the blockchain migrants and the local community to learn
from each other; although the language barrier would need to somehow be overcome.
Chapter 3 described Puerto Rico’s contentious history that undoubtably contributes to the
negative perceptions of the migrants by some local community members. Battles, protests, and
struggles for independence have in the past played out within the context of colonialism and its
legacy, which ultimately paved the way for Puerto Rico’s intermediate status of being neither a
colony nor an independent country. Since 2017, the Financial Oversight and Management Board
(FOMB) raised the sales tax to 11.5 percent and implemented austerity measures to align with a
severely reduced local government budget, in order to simply repay the island’s debt, which was
restructured to benefit the U.S. financial sector. The local community has witnessed the
privatisation and closure of public services, public spending cuts including the defunding of
education, land sell offs, and rising property prices in localities preferred by the migrants. Social
media campaigns, groups, and accounts, as well as traditional media reports voice these
concerns; though they often blame the migrants themselves rather than criticising the social,
structural, and material conditions that created such inequalities in wealth, power, access to
resources, and of course, lifestyle.
The relative privilege and symbolic representation of the U.S. embodied and enacted by
most of the migrants through their agency and choice in their daily lives, has reinforced the U.S.

237
image as a colonial power, amplified Puerto Rican scepticism towards migration and the tax
benefits (predominantly Individual Investor Act 22/Act 60), and added fuel to the media’s
negative portrayal of the situation. Expatriates had the opportunity to make their fortunes on the
mainland prior to relocating. Comparatively, most Puerto Ricans were born into relatively
underprivileged circumstances, with limited local opportunities that often paid a third of the
salary of the mainland. Thus, it is not surprising that the blockchain migrants were labelled by
some locals as colonisers, as they represented the most recent consequence of the island’s
historical trauma and contentious relationship with the United States.
Puerto Rico is a complex case study into blockchain migration, brought about by
government policies that aimed to promote economic growth. The arrival of blockchain migrants
specifically to the island is an unanticipated consequence of these policies. Migrants are
motivated by economic, political, and sociocultural considerations as well as structural factors
and personal circumstances when they make life-changing calculations of self-interest. The
relative power and financial privilege of blockchain migrants enables them to relocate with
significant ease. They can leverage their resources and negotiate the institutions and systems in
place to make individual lifestyle choices that help them to achieve an optimum level of
independence and control over their lives.
Now that the blockchain migrants have landed, Puerto Rico needs to decide whether it
wants to continue with the status quo or adapt to maximise the potential benefits brought by its
new residents. Strong migration networks, generous economic incentives, and lengthy tax
exemption periods are likely to ensure that blockchain migrants will stay. Economic
development and highly specialised intellectual capacity are the products of this migration, from
which Puerto Rico can extract value. It has the foundation in place giving it the potential to

238
quickly become a global leader in blockchain technology. Policy makers can choose to enact
laws that improve the allocation of labour, capital, and skills within the field. They can also
choose to develop legislation to provide the necessary legal clarity for the industry. Moreover,
blockchain technology presents both an opportunity and a disruptive threat to the traditional
finance sector, and ultimately, industry players, including banks, will need to adapt or die. A
reasonable first step for Puerto Rican banks would be to allow customers to use their accounts to
transfer fiat currency in-to and out-of crypto exchanges, which would also enable additional
capital to enter the local banking system.
Puerto Rico needs to decide how and if it wants its new residents to integrate into the
local culture. One-way integration, with the Puerto Ricans mixing with the migrants, but not the
reverse, has the potential to lead to cultural erosion. The language barrier limits opportunities for
migrant integration into Puerto Rican society. Encouraging migrants to learn Spanish is a smart
first step, although it will take time for the new arrivals to become fluent. Active dialogue with
the migrant community about immediate island needs is vital so that efforts to help are not
duplicated or in conflict with one another. Migrant ideas should be proposed rather than
imposed, and migrant resources need to be shared effectively with local project teams that
organise and manage community initiatives. Moreover, the individual investor portion of Act 60
should be open to all. It’s the primary point of contention with the local community, as it
discriminates against Puerto Ricans, with many perceiving the law as racist. While many Puerto
Ricans do not generate investment income from capital gains and could not afford to pay the
corresponding fees, the change has the potential to help close the cultural distance and improve
intergroup harmony and communication as all tax incentives would then be available to all
residents. Similarly, the Act 60 residential house purchase mandate that creates a legal

239
requirement for private property ownership on the island should be removed from the decree
programme. The purchase requirement forces migrants to make a more permanent commitment
by investing a significant amount of capital in property. This represents an opportunity cost for
most migrants as it uses investment that would have otherwise been available for their core
business or investment portfolio. The intent of this government policy may be to moderate the
speed and volume of migration, making it less attractive to those nearer the entry level for
benefiting from the tax decrees, swaying the incentives towards wealthier migrants, and
preventing people from extracting short-term benefits and then leaving the island. However, it
causes more problems than it solves. It generates manufactured demand for property and
perpetuates and reproduces settler colonial structures of dispossession. Consequently, property
values artificially increase, and the local population may be displaced as affordable housing is
lost and low-income residents face increased pressures due to the resulting gentrification of areas
favoured by the migrants (e.g. increased rental prices), which may cause cultural erosion.
Moreover, wealthier migrants who purchase a residential property under Act 60 are quite mobile
and so may leave it vacant for many months per year as Act 60 does not permit leasing.
Therefore, property that was once inhabited all year round by Puerto Ricans, may soon be left
unused for much of the year, simply because migrants have a legal obligation to purchase a
residence.
It’s certainly important to acknowledge the impact of power differentials between local
populations and newcomers in relation to relatively privileged migration; however, existing
blockchain migration research principally highlights marginalised populations rather than
considering the decision-making processes of those who trigger blockchain-related
developments. The literature also often fails to interrogate the societal regimes that facilitate and

240
encourage blockchain-related migration and entrepreneurship in developing economies.
Complex systems and structures in place (e.g. institutional arrangements and historical factors)
that incentivise [perceived] negative behaviours deserve to be criticised; but it is unfair to
criticise migrants for property ownership, the colonial situation, taking advantage of tax
incentives, or other outcomes from such broad influences outside of their control. It’s no small
decision to uproot one’s life to move thousands of miles away. It usually requires the loss of
local social and family ties, financial investment, learning a new culture, and sometimes a new
language, and a huge amount of preparation. Akin to other migrant groups, relatively privileged
migrants are also aiming to enhance their quality of life.
This study examines the day-to-day lives of blockchain migrants to understand the
implications of the arrival of (1) a particular technology cluster, and (2) a high concentration of
innovation, talent, and potential, to a relatively underdeveloped region. As with most societies,
Puerto Rico is in a period of great flux. Processes of globalisation, digitisation, and
decentralisation are transforming businesses, economic landscapes, and social wellbeing.
Immense opportunities for innovation and entrepreneurship result from such developments.
Technology can be used to achieve freedom and separate individuals from normative boundaries
of time and space. Digital nomads know this. Travel restrictions during the pandemic in 2020
meant that blockchain migrants in Puerto Rico throughout 2020 were less mobile than they
would have otherwise been. The closer connection test aspect of the decree for individual
investors also meant that qualifying migrants had to physically be in Puerto Rico for more time
than the United States or any other country during each tax year. Therefore, lifestyle migration at
first seems to be a reasonable lens to study the Puerto Rican case, specifically, as lifestyle
migration is a one-off transition. Digital nomads, on the other hand, are more multi-national,

241
fluid, and transient. They’re often depicted as individuals, who work remotely from a laptop in
cafes or co-working spaces around the world. They are less so considered to be executives or
running a huge corporation with a complex structure.
Lifestyle migration and digital nomadism can be quite interconnected. When
entrepreneurship and access to a knowledge cluster form part of the lifestyle that migrants want
to attain, both types of migration highlight the linkages between culture, digital skills, and the
ability to migrate from one place to another. Individuals who run multinational companies are
also very mobile as they travel for conferences, vacation, and necessary in-person meetings,
working remotely from wherever they are. Rather than staying in AirBnbs, co-living spaces, and
other low-cost temporary accommodation they might stay in properties that they own, as well as
expensive hotels, as they move around the world. So blockchain migrants, who are serial
entrepreneurs with several huge businesses for example, may not traditionally fit into the digital
nomad literature; however, many are digital nomads as they are not so tied to place and are more
mobile than the typical lifestyle migrant.
Privileged migration and the global economy are interrelated, and it is imperative that
contemporary migration research recognises this. Migration processes are exploited by
governments to accumulate financial and social capital from abroad and thus incentivise the
“right type” of individual to relocate. However, governments must seriously consider the
implications of such policies as they clearly impact more than the economic sphere. The social
structure in Puerto Rico reflects and is part of the global network society that has varying
geographies of inclusion and exclusion. The unbalanced distribution of the costs and benefits
resulting from relatively privileged migration and economic growth renders visible the social
dynamics, power relations, and systems shaping our world.

242
The depiction of blockchain migration illustrated and discussed throughout this study
provides a deeper understanding of the multifaceted realities pertaining to everyday life in Puerto
Rico, the difficulties related to balancing the variations of norms and expectations in diverse
cultural communities, and the evolving intersections of work, mobility, and lifestyle.
Furthermore, policies designed solely to attract outside investment can bring innovation, talent,
and other advantages, and governments should be proactive in looking at how they can capitalise
on these additional benefits. Social and mainstream media tends to sensationalise the
representation of migrants and focus on negative reporting, overlooking the complexities and
nuances of human life. Systems and structures are often ignored, while migrants are unfairly
criticised for perceived undesirable outcomes produced by push and pull factors that encourage
their migration. In this vein, policy debates surrounding such migration must be informed by a
wide and inclusive range of voices and opinions and carried out with compassion to ensure that
careful consideration is given to the lives of all the people who are affected.

243
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269
Appendix

SAN JUAN, P.R. — They call what they are building Puertopia. But then someone told them,
apparently in all seriousness, that it translates to “eternal boy playground” in Latin. So
they are changing the name: They will call it Sol.
Dozens of entrepreneurs, made newly wealthy by blockchain and cryptocurrencies, are heading
en masse to Puerto Rico this winter. They are selling their homes and cars in California
and establishing residency on the Caribbean island in hopes of avoiding what they see as

270
onerous state and federal taxes on their growing fortunes, some of which now reach into
the billions of dollars.
And these men — because they are almost exclusively men — have a plan for what to do with
the wealth: They want to build a crypto utopia, a new city where the money is virtual and
the contracts are all public, to show the rest of the world what a crypto future could look
like. Blockchain, a digital ledger that forms the basis of virtual currencies, has the
potential to reinvent society — and the Puertopians want to prove it.
So this crypto community flocked here to create its paradise. Now the investors are spending
their days hunting for property where they could have their own airports and docks. They
are taking over hotels and a museum in the capital’s historic section, called Old San Juan.
They say they are close to getting the local government to allow them to have the first
cryptocurrency bank.
“What’s happened here is a perfect storm,” said Halsey Minor, the founder of the news site
CNET, who is moving his new blockchain company — called Videocoin — from the
Cayman Islands to Puerto Rico this winter. Referring to Hurricane Maria and the
investment interest that has followed, he added, “While it was really bad for the people of
Puerto Rico, in the long term it’s a godsend if people look past that.”
Puerto Rico offers an unparalleled tax incentive: no federal personal income taxes, no capital
gains tax and favorable business taxes — all without having to renounce your American
citizenship. For now, the local government seems receptive toward the crypto utopians;
the governor will speak at their blockchain summit conference, called Puerto Crypto, in
March.

271
The territory’s go-to blockchain tax lawyer is Giovanni Mendez, 30. He expected the tax
expatriates to disappear after Hurricane Maria, but the population has instead boomed.
“It’s increased monumentally,” said Mr. Mendez, who has about two dozen crypto
clients. “And they all came together.”
The movement is alarming an earlier generation of Puerto Rico tax expats like the hedge fund
manager Robb Rill, who runs a social group for those taking advantage of the tax
incentives.
“They call me up saying they’re going to buy 250,000 acres so they can incorporate their own
city, literally start a city in Puerto Rico to have their own crypto world,” said Mr. Rill,
who moved to the island in 2013. “I can’t engage in that.”
The newcomers are still debating the exact shape that Puertopia should take. Some think they
need to make a city; others think it’s enough to move into Old San Juan. Puertopians said,
however, that they hoped to move very fast.
“You’ve never seen an industry catalyze a place like you’re going to see here,” Mr. Minor said.
The Monastery
Until the Puertopians find land, they have descended on the Monastery, a 20,000-square-foot
hotel they rented as their base and that was largely unscathed by the hurricane.
Matt Clemenson and Stephen Morris were drinking beer on the Monastery’s roof one recent
evening. Mr. Clemenson had an easygoing affect and wore two-tone aviators; Mr. Morris,
a loquacious British man, was in cargo shorts and lace-up steel-toed combat boots, with a
smartphone on a necklace. They wanted to make two things clear: They chose Puerto
Rico because of the hurricane, and they come in peace.

272
“It’s only when everything’s been swept away that you can make a case for rebuilding from the
ground up,” Mr. Morris, 53, said.
“We’re benevolent capitalists, building a benevolent economy,” said Mr. Clemenson, 34, a co-
founder of Lottery.com, which is using the blockchain in lotteries. “Puerto Rico has been
this hidden gem, this enchanted island that’s been consistently overlooked and
mistreated. Maybe 500 years later we can make it right.”
Other Puertopians arrived on the roof as a pack, just back from a full-day property-hunting bus
tour. From the middle, Brock Pierce, 37, the leader of the Puertopia movement, emerged
wearing drop crotch capri pants, a black vest that almost hit his knees and a large black
felt hat. He and others had arrived on the island in early December.
“Compassion, respect, financial transparency,” Mr. Pierce said when asked what was guiding
them here.
Mr. Pierce, the director of the Bitcoin Foundation, is a major figure in the crypto boom. He co-
founded a blockchain-for-business start-up, Block.One, which has sold around $200
million of a custom virtual currency, EOS, in a so-called initial coin offering. The value
of all the outstanding EOS tokens is around $6.5 billion.
A former child actor, Mr. Pierce got into digital money early as a professional gamer, mining and
trading gold in the video game World of Warcraft, an effort funded partly by Stephen K.
Bannon, the former Trump adviser. Mr. Pierce is a controversial figure — he has
previously been sued for fraud, among other matters.
Downstairs, in the Monastery penthouse, a dozen or so other expats were hanging out. The water
was out that night, so the toilets and faucets were dry. Mr. Minor lounged on an alcove
chaise.

273
“The U.S. doesn’t want us. It’s trying to choke off this economy,” Mr. Minor said, referring to
the difficulties that crypto investors have with American banks. “There needs to be a
place where people are free to invent.”
Mr. Pierce paced the room with his hands in fists. A few times a day, he played a video for the
group on his phone and a portable speaker: Charlie Chaplin’s 1940 “The Great Dictator,”
in which Chaplin parodies Hitler rallying his forces. He finds inspiration in lines like
“More than machinery, we need humanity.”
“I’m worried people are going to misinterpret our actions,” Mr. Pierce said. “That we’re just
coming to Puerto Rico to dodge taxes.”
He said he was aiming to create a charitable token called ONE with $1 billion of his own money.
“If you take the MY out of money, you’re left with ONE,” Mr. Pierce said.
“He’s tuned in to a higher calling,” said Kai Nygard, scion of the Canadian clothing company
Nygard and a crypto investor. “He’s beyond money.”
The force of Mr. Pierce’s personality and his spiritual presence are important to the group, whose
members are otherwise largely agnostic. Mr. Pierce regularly performs rituals. Earlier
that day while scoping out property, they had stopped at a historic Ceiba tree, known as
the Tree of Life.
“Brock nestled into the bosom of it and was there for 10 minutes,” Mr. Nygard said.
Mr. Pierce walked around the tree and said prayers for Puertopia, holding a rusted wrench he had
picked up in the territory. He kissed an old man’s feet. He blessed a crystal in the water,
as they all watched. He played the Chaplin speech to everyone and to the tree, Mr.
Nygard said.
That wrench is now in the penthouse, heavy and greasy.

274
Later on, at a dinner in a nearby restaurant, the group ordered platters of octopus arms, fried
cheese, ceviche and rum cocktails. They began debating whether to buy Puerto Rico’s
Roosevelt Roads Naval Station, which measures 9,000 acres and has two deepwater ports
and an adjacent airport. The only hitch: It’s a Superfund cleanup site.
Mr. Pierce had fallen asleep by then, his hat tilted down and arms crossed. He gets two hours of
sleep many nights, often on a firm grounding mat to stay in contact with the earth’s
electric energy. Josh Boles, a tall, athletic man who is another crypto expat, picked him
up, and the group headed back to the Monastery.
They walked past a big pink building in an old town square, the start of their vision for
Puertopia’s downtown. Once a children’s museum, they plan on making it a crypto
clubhouse and outreach center that will have the mission “to bring together Puerto Ricans
with Puertopians.”
The Vanderbilt
Workdays are casual in Puertopia. One morning, Bryan Larkin, 39, and Reeve Collins, 42, were
working at another old hotel, the Condado Vanderbilt, where they had their laptops on a
pool bar with frozen piña coladas on tap.
“We’re going to make this crypto land,” Mr. Larkin said.
Mr. Larkin has mined about $2 billion in Bitcoin and is the chief technology officer of
Blockchain Industries, a publicly traded company based in Puerto Rico.
Mr. Collins, an internet veteran, had raised more than $20 million from an initial coin offering
for BlockV, his app store for the blockchain, whose outstanding tokens are worth about
$125 million. He had also co-founded Tether, which backs cryptocurrency tied to the

275
value of a dollar and whose outstanding tokens are worth about $2.1 billion, though the
company has generated enormous controversy in the virtual currency world.
“So, no. No, I don’t want to pay taxes,” Mr. Collins said. “This is the first time in human history
anyone other than kings or governments or gods can create their own money.”
He had moved from Santa Monica, Calif., with just a few bags and was now starting a local
cryptocurrency incubator called Vatom Factory.
“When Brock said, ‘We’re moving to Puerto Rico for the taxes and to create this new town,’ I
said, ‘I’m in,’” Mr. Collins said. “Sight unseen.”
They soon went back to work, checking out Coinmarketcap.com, a site that shows the price of
cryptocurrencies.
“Our market cap’s gone up $100 million in a week,” Mr. Collins said.
“Congrats, man,” Mr. Larkin said.
Welcome, Puertopians?
All across San Juan, many locals are trying to figure out what to do with the crypto arrivals.
Some are open to the new wave as a welcome infusion of investment and ideas.
“We’re open for crypto business,” said Erika Medina-Vecchini, the chief business development
officer for the Department of Economic Development and Commerce, in an interview at
her office. She said her office was starting an ad campaign aimed at the new crypto expat
boom, with the tagline “Paradise Performs.”
Others worry about the island’s being used for an experiment and talk about “crypto
colonialism.” At a house party in San Juan, Richard Lopez, 32, who runs a pizza
restaurant, Estella, in the town of Arecibo, said: “I think it’s great. Lure them in with
taxes, and they’ll spend money.”

276
Andria Satz, 33, who grew up in Old San Juan and works for the Conservation Trust of Puerto
Rico, disagreed.
“We’re the tax playground for the rich,” she said. “We’re the test case for anyone who wants to
experiment. Outsiders get tax exemptions, and locals can’t get permits.”
Mr. Lopez said the territory needed something to jump-start the economy. “We have to find a
new way,” he said.
“Sure then, Bitcoin, why not,” Ms. Satz said, throwing up her hands.
Mr. Lopez said he and a childhood friend, Rafael Perez, 31, were trying to set up a Bitcoin mine
in their hometown. But electricity has been inconsistent, and mining even a single Bitcoin
takes a lot of power, he said.

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Asset Metadata

Creator Clayton, Sarah Lianne (author)

Core Title Blockchain migration: narratives of lived experiences in Puerto Rico at the dawn of a new digital era

School Annenberg School for Communication

Degree Doctor of Philosophy

Degree Program Communication

Degree Conferral Date 2022-05

Publication Date 01/27/2024

Defense Date 11/12/2022

Publisher University of Southern California (original), University of Southern California. Libraries (digital)

Tag blockchain,COVID-19,cryptocurrency,economic development,entrepreneurship,human migration,innovation,OAI-PMH Harvest,Puerto Rico,tax incentives,technology diffusion

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