Why was former City Councilman Alan Warrick hanging out in Puerto Rico with a star of the movie Mighty Ducks?
The nonprofit CEO and former District 2 representative was in the U.S. island territory in May attending Restart Week, a convention of investors and entrepreneurs looking to rebuild Puerto Rico’s economy in light of the devastation wreaked last year by Hurricane Maria.
He attended the conference on the invitation of child actor and cryptocurrency mogul Brock Pierce, who has vowed to donate $1 billion of his own money to relief efforts there.
Those efforts are part of the vision that Pierce and his fellow crypto enthusiasts call “Puertopia,” a Silicon Valley of the emerging world of digital currency and its underlying technology, blockchain.
An Australian broadcast network this week released a short documentary on the booming interest in cryptocurrency that featured Pierce and the former councilman. Warrick stood up for the entrepreneurs as they faced heated opposition at a town hall-like event in which Puerto Ricans voiced their suspicions about the businessmen’s intentions.
“All of these people have such good intentions, and they are going to make something beautiful happen and you’re going to be a part of it — whether you like it or not,” Warrick said.
A Puerto Rican woman fingered Warrick in response: “Exacto – whether I like it or not.”
Warrick declined to comment for this article. Pierce and the organization he advises, The Bitcoin Foundation, deferred to Executive Director Llew Claasen, who did not respond to requests for comment.
Warrick lost his bid for another term on City Council last year after he was found asleep on a bench at City Hall one morning after a night of drinking at a downtown bar in May 2017.
In May 2018, the Texas Ethics Commission fined him $5,000 for improperly loaning $15,000 from his campaign funds to his nonprofit World Technical Services, which provides employment and training opportunities for people with disabilities.
According to the ruling, Warrick said his business was experiencing “cash flow issues” and eventually repaid the loan.
The former elected official seems to have found a passion for cryptocurrency. The list of decentralized, or non-government-controlled, digital currency exchanges exceeds 1,000. Introduced in January 2009, Bitcoin remains the highest-valued digital asset.
Warrick’s first mention of digital currency on Twitter appears to be in December 2017. Interest in cryptocurrency ballooned after Bitcoin’s valuation peaked at $20,000 per coin that month.
In February, Warrick pronounced his desire to work with megamillionaire Pierce and his entourage of entrepreneurs and digital coin collectors on Twitter.
“I’m ready to move and help,” he said in a tweet to Pierce. “I have 2 small children though. If I bring my wife down for a visit will she be scared off?”
“It’s gorgeous,” Pierce replied. “She should love it.”
On May 2, Warrick tweeted he would be attending Restart West conference in the west coast city of Mayaguez from May 10-13.
Pierce’s net worth is reported in the range of $700 million to $1 billion. He made his fortune first in the videogaming world and jumped onto the Bitcoin and blockchain bandwagon early.
His success has not come without controversy. In 2013, he lost a civil lawsuit after he failed to pay a $120,000 credit card bill.
The government of Puerto Rico has a long history of offering tax incentives to U.S. corporations designed to inject foreign investment into the country. Additionally, U.S. citizens who make Puerto Rico their permanent residence are not required to pay federal income tax and or capital gain tax.
St. Mary’s University School of Law professor Angela Walch has been researching the nascent industry — as the 2017 rise in coin valuations fueled a modern-day gold rush.
“I’m very skeptical of what’s going on Puerto Rico,” Walch said. “I haven’t met Brock Pierce; I don’t know him. But it rings very problematic to me what’s happening there – the idea that tech can save everything when there are much more complex social problems. Tech might be able to solve one simple part of it.”
Interest in blockchain and crytpocurrency is growing locally, she said. Recently she took part in an educational series at Geekdom where she explained the legal implications of the developing crypto economy.
Walch poses the question: As governments appeal to venture capitalists and entrepreneurs to capture jobs and investment with tax breaks, do officials understand the consequences of creating a favorable legal environment?
“We don’t have electricity. We don’t have clean water,” Walch said, referring to conditions in the U.S. territory. “But it’s going to be the blockchain that’s going to [fix] this?”
Alex Eaton, a local cryptocurrency enthusiast and community manager at digital wallet platform BRD, said the drive for social good among the cryptocurrency community is sincere. Activism and serving the common good is a unifying trait among crypto collectors, Eaton said.
He said the concept of Puertopia is plausible and pointed to other examples, such as the Eastern European micronation Liberland founded on cryptocurrency donations.
“Cryptocurrency has started to [awaken] this idea, this notion, that we can create anything,” Eaton said. “I never imagined you could create a country. I thought the whole world was kind of taken over by governments, entities, and corporations, and I was proven wrong time and time again when you have young entrepreneurs who couldn’t give a flying f–k about the old-school rules.”
Javier Guerra, co-founder of local tech solutions provider TechQuarry, said rather than handouts, the focus should be on giving the people of Puerto Rico a hand up. He suggested training and education around cryptocurrency and blockchain – digital, unalterable, and virtually hack-proof ledger on which cryptocurrency transactions are recorded – can truly catapult Puerto Rico into a tech hub.
Guerra is a close partner in Bloqspace, which aims to become an educational nexus for such emerging technologies as blockchain and digital currency. The local organization has installed cryptocurrency ATMs in San Antonio and El Paso. They donated another one to Arecibo, Puerto Rico. He said training Puerto Ricans to become blockchain developers would have a more profound and lasting impact than some of the efforts he is seeing in the island territory.
Puerto Ricans have a right to hit the pause button when the motives of incoming businesspeople remain unclear, Guerra added.
The critics are “uninformed,” Pierce said in an ABC News Australia interview.
“They haven’t met us,” he said. “Hang out for a moment, and you should be able to tell instantly that that’s not our intentions.”
As for Warrick, his Twitter timeline continues to reflect his growing interest in digital currency and admiration for Pierce.
— Alan E. Warrick II (@AlanWarrickII) July 27, 2018