American crypto investors are coming to Puerto Rico. This is why

Puerto Rico, the island nation of the United States, has become a popular destination for cryptocurrency lenders. Not only because of the favorable tax climate.

So far this year, Puerto Rico has received more than 1,200 applications – a record – through it Personal Investors Act, Which exempts new residents from paying tax on capital gains. The number of U.S. residents seeking tax breaks for Puerto Rico has tripled this year.

An additional 274 partnerships, affiliates and other organizations have been approved Export Services Act, Which offers a 4% corporate tax rate and a 100% deduction on dividends. Both fall down Law of Puerto Rico 60, A tax incentive package set up in 2019 to attract investment from various industries.

Puerto Rico Blockchain Week

While the drive to attract companies with tax breaks has been going on for years, the island is particularly attracting crypto professionals. For example, Pantera Capital and Redwood City Ventures, two crypto investment firms, recently opened offices on the island, reports Bloomberg.

The island also holds its first place Puerto Rico Blockchain Week Kicked. On the first day of the conference, Puerto Rico House Speaker Raphael “Dadito” Hernandez suggested that the legislature should look into the use Blockchain technology Around Simplify administration.

“It’s not just ‘going to Puerto Rico to save taxes,'” said Giovanni Mendes, a local corporate lawyer. “It’s: ‘Go to Puerto Rico, because everyone’s there.'”

Eventually, Puerto Rico will be recognized as a blockchain capital, ”said Michael Derbin, founder of BitAngels, which flew from Las Vegas to the island in 2016. In crypto circles he is called the “Messiah” because of his evangelism about the island’s tax concessions and the new business community.

Paradoxically, Puerto Rico is also home to some of the world’s best economists and outspoken speakers. Cryptocriticus Peter Schiff, Which is a golden bull and All round doemprofeet.

Mini Miami

The crypto community is mainly settled in three areas along the coast.

There are isolated shelters. For example, Bahia, 41 kilometers east of the capital San Juan, and the Dorado Beach Resort in the Ritz-Carlton, 37 kilometers west of the capital.

The wealthy who are looking for a more urban lifestyle have opted for a high-rise neighborhood and shopping district in San Juan, where condominiums and hotel towers line the sea. “There are restaurants, coffee shops and a mall,” said Brent Johnson, CEO of Santiago Capital, a property management company that moved from San Francisco to Contado in May. “It’s a kind of mini Miami. “

Resistance

Proponents of her case have been working to make the actual transcript of this statement available online. They also think that a favorable financial environment in general will provide new impetus.

However, there is also opposition to the idea: some laws apply only to new residents, so islanders who have lived on the island for a lifetime are ineligible. Some are reluctant to welcome the new crop of wealthy residents, fearing that income flow will exacerbate inequality and create social tensions. As it stands, real estate prices are already skyrocketing to “ridiculous” levels. But so far, the stimulus seems to be creating jobs for Puerto Ricans as well.

From 2015 to 2019, about 4,400 jobs were created. Personal Investors Act And by 36,222 Export Services Act, According to a study by Puerto Rican consulting firm Estudios Technicos. Call centers provided more work, followed by consulting, advertising, public relations and tax and accounting services.

Alberto Paco-Bagh, a former secretary of the ministry and a driving force behind the tax cuts, said they were doing what they wanted to do. Act 60.

Carlos Fontaine, director of incentives for the Ministry of Economic Development and Trade, said the doors of the crypto community will remain open until jobs are created. Ideally, we want to create a Puerto Rico – not just a Puerto Rico for new residents and local business leaders.

(Kg)