To reduce the tax burden, American cryptocurrency companies are migrating to a US-controlled island with zero income taxes.
According to local law, citizens who have lived in Puerto Rico for at least six months,
released from taxes on interest, dividends and capital gains. As a result, investors can retain most or all of the profits from cryptocurrencies or other investments without the need to renounce US citizenship.
Puerto Rico was first spoken of as a tax-friendly country for cryptocurrency investors in March, when former Facebook employee Frances Haugen moved to Puerto Rico. After that, the state became a haven for crypto investors. One such investor is crypto billionaire Logan Paul. The founder of Cryptozoo moved to the island in early 2021. Paul believes that thanks to the island’s soft taxation policy, cryptocurrency investors are gaining an advantage to grow their businesses.
“In Puerto Rico, you are motivated to do more, make more money and not be afraid of the consequences of your decisions.”
Many cryptocurrency companies have opened their offices in the island nation this year. Among them are such big businesses as the Pantera Capital hedge fund from New York and the NFT SuperRare platform from Silicon Valley. From the representatives of the traditional business – the investment fund of John Paulson (John Paulson).
The Puerto Rico Blockchain Trade Association (PRBTA) recently announced the Puerto Rico Blockchain Week event in December 2021. Its goal is to attract cryptocurrency companies and investments to the island. PRBTA CEO Keiko Yoshino believes that in this way they will be able to consolidate cryptocurrency companies and communities in Puerto Rico. The migration of cryptocurrency capital stimulates the economy of Puerto Rico and contributes to the development of not only cryptocurrency, but also traditional business.
The island nation’s authorities have long been instrumental in the adoption of cryptocurrencies in Puerto Rico. In 2019, San Juan Mercantile Bank Trust International (SJMBT) began serving cryptocurrency investors on an island in the Caribbean. In 2018, a working group was created in Puerto Rico to study blockchain projects. But in 2020, the Governor of Puerto Rico, Wanda Vazquez, signed a law increasing the annual fee for cryptocurrency entrepreneurs from $ 300 to $ 5,000. Many tax experts believe that this could cause an outflow of cryptocurrency capital from the island.
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