The last week brought some disturbing news for the crypto community of Puerto Rico. The island was previously a massive crypto supporter, and one of the few ‘crypto havens’ around the world. But, all of that seems to be coming to an end now. The reason for that is the resignation of this US territory’s Governor, Ricardo Rossello.
Rossello was a big crypto supporter himself, and after allegations regarding mismanagement and corruption, it was announced that he will step down on August 2nd, three days from now.
While this is terrible news for Puerto Rico’s crypto community, the resignation did come as a result of mass protests. A large portion of the island’s 3.2 million population hit the streets after his obscenity-laced online chats emerged. For many, this was the last straw, and the demonstrations started. Apparently, this was a series of the most massive protests in the island’s history.
Political scandals, protests, and changes in Puerto Rico’s government aside – what does this mean for the cryptocurrency sector?
Many have voiced their opinions, such as Bryce Weiner, the co-founder of L.A.- based Altmarket cryptocurrency exchange.
And so dies the dream of Crypto Rico.
— Bryce “Do you have a demo" Weiner (@BryceWeiner) July 25, 2019
Weiner believes that the island’s crypto utopia will disappear alongside Rossello. Not only is there a chance that a crypto-unfriendly individual will replace him, but the association with the politician will likely damage cryptos’ reputation.
Puerto Rico and the arrival of cryptocurrencies
As a territory of the US, Puerto Rico does not require people to obtain a visa to travel, or even go live there. Meanwhile, the island enjoys lower tax rates, introduced by Rossello. Also, it is much easier to set up financial institutions there than in any other part of the US. All of this made it quite popular among crypto enthusiasts and businesses.
Some of the more notable individuals who were drawn to Puerto Rico by this include Brock Pierce – a Mighty Ducks star; James Collins, the New York Mercantile Exchange’s former president, and others. The future of cryptocurrencies in Puerto Rico seemed quite bright. In fact, Videocoin founder Halsey Minor – also one of those attracted by Puerto Rico conditions – stated that this is a perfect opportunity to observe how an industry can catalyze a place.
Not only that, but there were considerable efforts that would have led to a much-improved life on the island. This included clothing for those in need, beach-cleaning initiative, help for agricultural projects, extra funds for startup support, and more.
However, the country still struggles with a recession, which has been going on for around a decade. Things have hardly changed with more significant crypto usage, and issues like bankruptcy, high unemployment rate, and other problems remain. Not to mention the struggle to fix the damage caused by Hurricane Maria.
In other words, the reduced taxes did not improve the quality of life, nor did they help the locals prosper. All they did was attract crypto users and the wealthy who aimed to avoid paying high taxes on the mainland.