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Crypto millionaires are pouring money into Central America to build their own cities

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bitcoin butterfly


Romer collaborated with the Honduran government at first, but they parted ways following disagreements over how his idea was being implemented. (Romer didn’t respond to a request for comment.)

Próspera, which broke ground in 2020, plans to implement ultra-low taxes, outsource services typically managed by the public sector, establish an “arbitration center” in place of a court, and charge an annual fee for citizenship (either physical or e-residency) that involves signing a “social contract” the company hopes will discourage misbehavior.

When I visited the site in February, a central office was one of the few completed buildings. There was no private Próspera police force, but on the front desk was a number for Bulldog Security International, a private security company engaged by hotels on the island that consider the local police force inadequate. A pair of two-story buildings housed office workers. The rest was largely a construction site, although a residential tower block is underway.

A rendering of the future Próspera shows apartments that appear to take inspiration from the shells of the island’s indigenous conch—soft curves in pearly coral, cream, and glass. A strip of white sand separates the apartment block from the gentle lap of the Caribbean Sea.

The businesses most likely to be drawn here are those keen to escape regulation in their own countries—Próspera’s chief of staff, Trey Goff, highlights medical innovation, health tourism, and just about every facet of the cryptocurrency industry. 

“There’s an automatic degree of overlap with the crypto industry and what we’re doing,” he says. “Because they see themselves as at the forefront of financial innovation, and we want to enable that.”

MICHAEL BYERS

Some people who work in tech and crypto have already set up in the jurisdiction remotely through its e-residency program. Businesses can freely transact in whichever cryptocurrency they choose, and five have been approved for use at the government level. 

Próspera’s advisors include Oliver Porter, founder of Sandy Springs, Georgia—until recently a fully privatized city in the US that Próspera’s outsourcing model will mimic. So far, Próspera says, Silicon Valley venture capitalists and private investors have put $50 million into the project, with another $100 million fundraising round underway. 

The amount raised so far includes money from billionaire Peter Thiel, venture capitalist Marc Andreessen, and investors Roger Ver and Balaji Srinivasan through Pronomos Capital. Pronomos Capital told Bloomberg in 2018 that it had discussed setting up semi-autonomous cities in countries including Ghana, Honduras, the Marshall Islands, Nigeria, and Panama.

Broken links

If you continue along the road that leads to Próspera, you’ll soon encounter a village of about 100 people called Crawfish Rock. Hunkered down in a piece of patchy woodland on the coast are a collection of wooden houses, painted in fading pastels and propped up on stilts. Chickens scratch in patches of weed sprouting under palm trees. It’s a long way from the glaring white of Próspera’s air-conditioned boardroom.

In Crawfish Rock, I’m greeted by Luisa Connor, head of the village’s Patronato, or community board. She belongs to the Garifuna community—descendants of slaves brought to the island by British colonizers in the late 1700s. Sitting in plastic chairs in her yard as her young daughter plays nearby, we discuss the pushback against Próspera, which has mutated from a community-led effort into a national repudiation of ZEDEs. Connor paints a picture of deception on the part of Próspera, saying it portrayed itself as a regular tourism development when it asked the community to sign a document of consent, promising that villagers would be offered the first jobs on the site.

Villagers soon discovered, however, that the project would be something quite different, and relations swiftly frayed. Connor says Próspera CEO Erick Brimen offered to buy Crawfish Rock outright; she declined on behalf of the village. But residents grew concerned that Próspera would seize their land to make way for its expanding city-state. 

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Land grabbing has a long, bloody history in Honduras. Successive governments have empowered companies to snatch land from peasants—resulting in conflict that in one area alone has led to more than 150 murders and disappearances since 2008.

Próspera executive Daniel Frazee says the company’s contract prevents it from expropriating land and that it plans to expand in directions where there are no settlements. But Connor says that after she declined Brimen’s offer, he told her the Honduran government might seize it. When asked about Connor’s comments, Próspera denied attempting to buy Crawfish Rock and said its charter and bylaws prevent it from receiving expropriated land from the Honduran government.

Islanders I spoke with expressed a fundamental objection to ceding pieces of Honduran land to the control of corporate entities. They “respect no government, no rules, no law; just a dream,” Rosa Daniela, a community activist involved in the campaign against Próspera, told me. “They don’t believe they are living in your country, because they want to start a new country.”

Eventually, Connor blocked Brimen’s number. The village no longer has any dialogue with Próspera, she says. Goff tells it differently: “We have very much focused on, from very early on, building strong community relations with that community.”

Since Próspera launched, the political climate has changed. Amid growing backlash against ZEDEs based on concerns like those raised at Crawfish Rock, the new Honduran president, Xiomara Castro, ran on a platform that promised shutting them down, putting Próspera’s longevity in question.

“We are just an experiment”

Ground hasn’t yet broken on Bitcoin City, but Conchagua Volcano is already home to several settlements, raising the specter of displacement, says Salvadoran economist José Luis Magaña—especially given that only about a fifth of the farmers in the region own the land they work on.

The government says the project is intended to provide jobs to the poor neighboring town of La Unión, but Magaña says socioeconomic disparities between the town and El Salvador’s bigger cities make gentrification the more likely outcome.

Unlike Próspera, Bitcoin City has the backing of the current government. But an influx of foreign investors and the displacement of local people could eventually stoke a similar backlash. Three days after Bitcoin City was announced, El Salvador passed a new law that would allow the government to expropriate land for public use. 

To prevent speculators from driving up land prices, the exact location of Bitcoin City remains vague. But real estate companies from Europe, wealthy Salvadoran businessmen, and cryptocurrency companies have offered to buy the land that El Espíritu de la Montaña sits on from Diaz for three to five times the price he paid.

Diaz is adamant that he won’t sell: “This is a life project for me.” He supports Bukele and believes Bitcoin City will stimulate economic growth in the area, although he notes that people he knows in La Unión are concerned about being forced to move. 

Back in Honduras, researcher José Luis Palma Herrera sees ZEDEs and projects like them as a modern twist on the region’s painful history of corporate colonialism. “The promise of ending poverty and improving lives has been used to get citizens to accept these enclaves of corruption and exploitation,” he says. “However, most of the profits from the enclaves go outside the country, [with] no real development in the regions where they’ve been.”

Besides Próspera, there are three more ZEDEs in Honduras. Less radical private city projects are now underway in Malawi and the US. Ethereum creator Vitalik Buterin has been involved in talks with the Zambian government about setting up a crypto-powered special economic zone. 

“We’re trying to help create an entirely new kind of industry … the industry of building cities,” says Goff. He says he’d like to see a couple of hundred developments around the world one day—“bright spots of prosperity all working together to create a brighter future for humanity.”

Not everyone is sold on the dream. In Roatán, Rosa Daniela worries about the impact on her community and others like it. “They come to us, these adventurous guys, in the name of liberty,” she says. “They want to start with us; we are just an experiment. If they find success here, they will move to your country and other countries in the world.”

Laurie Clarke is a freelance technology journalist based in the UK

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The hunter-gatherer groups at the heart of a microbiome gold rush

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The hunter-gatherer groups at the heart of a microbiome gold rush


The first step to finding out is to catalogue what microbes we might have lost. To get as close to ancient microbiomes as possible, microbiologists have begun studying multiple Indigenous groups. Two have received the most attention: the Yanomami of the Amazon rainforest and the Hadza, in northern Tanzania. 

Researchers have made some startling discoveries already. A study by Sonnenburg and his colleagues, published in July, found that the gut microbiomes of the Hadza appear to include bugs that aren’t seen elsewhere—around 20% of the microbe genomes identified had not been recorded in a global catalogue of over 200,000 such genomes. The researchers found 8.4 million protein families in the guts of the 167 Hadza people they studied. Over half of them had not previously been identified in the human gut.

Plenty of other studies published in the last decade or so have helped build a picture of how the diets and lifestyles of hunter-gatherer societies influence the microbiome, and scientists have speculated on what this means for those living in more industrialized societies. But these revelations have come at a price.

A changing way of life

The Hadza people hunt wild animals and forage for fruit and honey. “We still live the ancient way of life, with arrows and old knives,” says Mangola, who works with the Olanakwe Community Fund to support education and economic projects for the Hadza. Hunters seek out food in the bush, which might include baboons, vervet monkeys, guinea fowl, kudu, porcupines, or dik-dik. Gatherers collect fruits, vegetables, and honey.

Mangola, who has met with multiple scientists over the years and participated in many research projects, has witnessed firsthand the impact of such research on his community. Much of it has been positive. But not all researchers act thoughtfully and ethically, he says, and some have exploited or harmed the community.

One enduring problem, says Mangola, is that scientists have tended to come and study the Hadza without properly explaining their research or their results. They arrive from Europe or the US, accompanied by guides, and collect feces, blood, hair, and other biological samples. Often, the people giving up these samples don’t know what they will be used for, says Mangola. Scientists get their results and publish them without returning to share them. “You tell the world [what you’ve discovered]—why can’t you come back to Tanzania to tell the Hadza?” asks Mangola. “It would bring meaning and excitement to the community,” he says.

Some scientists have talked about the Hadza as if they were living fossils, says Alyssa Crittenden, a nutritional anthropologist and biologist at the University of Nevada in Las Vegas, who has been studying and working with the Hadza for the last two decades.

The Hadza have been described as being “locked in time,” she adds, but characterizations like that don’t reflect reality. She has made many trips to Tanzania and seen for herself how life has changed. Tourists flock to the region. Roads have been built. Charities have helped the Hadza secure land rights. Mangola went abroad for his education: he has a law degree and a master’s from the Indigenous Peoples Law and Policy program at the University of Arizona.

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The Download: a microbiome gold rush, and Eric Schmidt’s election misinformation plan

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The Download: a microbiome gold rush, and Eric Schmidt’s election misinformation plan


Over the last couple of decades, scientists have come to realize just how important the microbes that crawl all over us are to our health. But some believe our microbiomes are in crisis—casualties of an increasingly sanitized way of life. Disturbances in the collections of microbes we host have been associated with a whole host of diseases, ranging from arthritis to Alzheimer’s.

Some might not be completely gone, though. Scientists believe many might still be hiding inside the intestines of people who don’t live in the polluted, processed environment that most of the rest of us share. They’ve been studying the feces of people like the Yanomami, an Indigenous group in the Amazon, who appear to still have some of the microbes that other people have lost. 

But there is a major catch: we don’t know whether those in hunter-gatherer societies really do have “healthier” microbiomes—and if they do, whether the benefits could be shared with others. At the same time, members of the communities being studied are concerned about the risk of what’s called biopiracy—taking natural resources from poorer countries for the benefit of wealthier ones. Read the full story.

—Jessica Hamzelou

Eric Schmidt has a 6-point plan for fighting election misinformation

—by Eric Schmidt, formerly the CEO of Google, and current cofounder of philanthropic initiative Schmidt Futures

The coming year will be one of seismic political shifts. Over 4 billion people will head to the polls in countries including the United States, Taiwan, India, and Indonesia, making 2024 the biggest election year in history.

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Navigating a shifting customer-engagement landscape with generative AI

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Navigating a shifting customer-engagement landscape with generative AI


A strategic imperative

Generative AI’s ability to harness customer data in a highly sophisticated manner means enterprises are accelerating plans to invest in and leverage the technology’s capabilities. In a study titled “The Future of Enterprise Data & AI,” Corinium Intelligence and WNS Triange surveyed 100 global C-suite leaders and decision-makers specializing in AI, analytics, and data. Seventy-six percent of the respondents said that their organizations are already using or planning to use generative AI.

According to McKinsey, while generative AI will affect most business functions, “four of them will likely account for 75% of the total annual value it can deliver.” Among these are marketing and sales and customer operations. Yet, despite the technology’s benefits, many leaders are unsure about the right approach to take and mindful of the risks associated with large investments.

Mapping out a generative AI pathway

One of the first challenges organizations need to overcome is senior leadership alignment. “You need the necessary strategy; you need the ability to have the necessary buy-in of people,” says Ayer. “You need to make sure that you’ve got the right use case and business case for each one of them.” In other words, a clearly defined roadmap and precise business objectives are as crucial as understanding whether a process is amenable to the use of generative AI.

The implementation of a generative AI strategy can take time. According to Ayer, business leaders should maintain a realistic perspective on the duration required for formulating a strategy, conduct necessary training across various teams and functions, and identify the areas of value addition. And for any generative AI deployment to work seamlessly, the right data ecosystems must be in place.

Ayer cites WNS Triange’s collaboration with an insurer to create a claims process by leveraging generative AI. Thanks to the new technology, the insurer can immediately assess the severity of a vehicle’s damage from an accident and make a claims recommendation based on the unstructured data provided by the client. “Because this can be immediately assessed by a surveyor and they can reach a recommendation quickly, this instantly improves the insurer’s ability to satisfy their policyholders and reduce the claims processing time,” Ayer explains.

All that, however, would not be possible without data on past claims history, repair costs, transaction data, and other necessary data sets to extract clear value from generative AI analysis. “Be very clear about data sufficiency. Don’t jump into a program where eventually you realize you don’t have the necessary data,” Ayer says.

The benefits of third-party experience

Enterprises are increasingly aware that they must embrace generative AI, but knowing where to begin is another thing. “You start off wanting to make sure you don’t repeat mistakes other people have made,” says Ayer. An external provider can help organizations avoid those mistakes and leverage best practices and frameworks for testing and defining explainability and benchmarks for return on investment (ROI).

Using pre-built solutions by external partners can expedite time to market and increase a generative AI program’s value. These solutions can harness pre-built industry-specific generative AI platforms to accelerate deployment. “Generative AI programs can be extremely complicated,” Ayer points out. “There are a lot of infrastructure requirements, touch points with customers, and internal regulations. Organizations will also have to consider using pre-built solutions to accelerate speed to value. Third-party service providers bring the expertise of having an integrated approach to all these elements.”

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