Bitcoin billionaire Brock Pierce wants to transform Puerto Rico into a crypto paradise

Updated

July 24, 2018 05:23:08

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Bitcoin billionaire Brock Pierce says blockchain will be transformative. (ABC News: Mat Marsic)

Hurricane Maria was one of the worst natural disasters in US history, devastating the island of Puerto Rico and destroying the entire power grid.

Harvard University estimates more than 4,000 people may have lost their lives … a bigger death toll than 9/11 and Hurricane Katrina combined.

Ten months on, thousands are still without power or safe shelter as the annual hurricane season starts again.

Yet while some see catastrophe, others see opportunity.

Cryptocurrency entrepreneurs have been storming in, promising they have the technology to rebuild.

Puetro Rico is still recovering from the devastation caused by Hurricane Maria
Photo:
Puetro Rico is still recovering from the devastation caused by Hurricane Maria. (ABC News: Matt Davis)

Transformative technology

At 37, Brock Pierce is a billionaire. And he has chosen storm-ravaged Puerto Rico as his new home.

“Puerto Rico has the possibility now to be put on the map as a hub of innovation,” he told Foreign Correspondent. “And the pleasure of bringing essentially the most innovative industry the world has ever seen to a place that normally wouldn’t have been a hub, that’s a wonderful thing if it works.”

Mr Pierce was a child actor in the 1990s, starring in Disney films such as The Mighty Ducks.

He went on to invest in video games before making a fortune in cryptocurrencies such as Bitcoin, which jumped from below $US1,000 ($1,346) to nearly $26,932 in 2017, before crashing to a low of $8,887 in April.

But Mr Pierce said the technology that made cryptocurrencies possible would change the world.

“Has the internet changed our lives? Have mobile phones changed our lives? The blockchain is something that is that transformative,” he said.

“But you don’t need to understand it in the same way that you know how your phone works.”

Que es blockchain?

Ask any Puerto Rican what blockchain is and the chances are you will get a blank stare.

Few people have heard of the new technology and more are grappling with low-tech problems, like how to fix their roofs or rig up power lines before another hurricane comes.

Across the island, many are still waiting for disaster relief funds or for their villages to be reconnected to the grid.

But Mr Pierce believes blockchain could empower people to rebuild without relying on governments or banks.

“On the most basic level, it has the potential to democratise the global financial system,” he said.

“And by the way, having access to simple financial tools is almost as important as having clean drinking water.”

A Puerto Rican woman smiles
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Puerto Rico shares the same Latin and Caribbean heritage as Cuba. (ABC News: Mat Marsic)

At its simplest, blockchain is an online data management system that keeps encrypted records of transactions.

The records, called blocks, are almost impossible to hack. Each new block updates a chain, creating a secure chronological history.

In short, blockchain is like a bank ledger except you do not need to use a bank. You become your own bank.

All you need is a mobile phone to do business transactions directly. You do not need a third party to validate them. And you have a permanent and secure record of every transaction online.

Advocates say that has real implications for reconstruction. Villages could use the software to set up communal building funds and track how every dollar is spent.

They could install solar power grids and charge each household for how much they use. They could use cryptocurrency to transfer funds or buy goods directly without paying commissions or bank fees.

So far there are more ideas than actual examples. But slowly, signs of blockchain business are emerging.

‘Blessing from God’

As a taxi driver in the capital San Juan, Jose Santana has faced two big challenges.

San Juan taxi driver taxi driver Jose Santana
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San Juan taxi driver Jose Santana has become the driver of choice for many blockchain developers. (ABC News: Mat Marsic)

One is negotiating busy intersections where the traffic lights have not worked for months.

The other is satisfying customers wanting to pay for the ride in Bitcoin. The first time a digital entrepreneur booked him, he had to google what Bitcoin was.

“I had one hour and 30 minutes to figure it out because I tell the client a white lie. Like I said ‘I accept cryptocurrency’ but I didn’t. So I had to figure out how to do it because maybe this is going to be an opportunity for me right now.”

Mr Santana downloaded a crypto-wallet to his smartphone and soon became the driver of choice for dozens of blockchain developers moving to the capital, San Juan. He…

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