Is Portugal a crypto haven or mutton dressed up as lamb?
Greetings from Copenhagen and the frantically cool-and-busy Tech BBQ conference where your correspondent conducted a fireside chat with Tim Draper who was wearing his Bitcoin tie and spoke of Utopias.
As usual hype and free alcohol dominated, but the Holy Trinity of metaverse, Web3 and crypto were the talk of the Tivoli and Copenhagen feels as if it might be the centre of the universe in the years to come.
In Europe and recent years, there has been only one city that has been the poster child of the future (and crypto) and that has been Lisbon. I have seen the best minds of my generation consumed by madness as they left London behind in a rush to nibble from Portugal’s tax carrot.
Even this week, one such entrepreneur – Oleg Fomenko and his company Sweatcoin – had its fabulously successful TGE after relocating from London to Lisbon at the time of the pandemic and there are many in the crypto, as well as the wider tech, community who live there quite happily.
However, it appears that, as usual, there is trouble in Paradise. Some are questioning the granting of so-called golden visas and the crypto tax status as a haven may be under threat of severe regulation.
Earlier this year the FT published a piece that said only 30% of the public believe in the Portuguese judiciary and there are investors who are beginning to talk of corruption and slow-paced bureaucracy.
A business group there said recently this is the biggest problem in the country. The local Portuguese press are also calling out maverick judges who seem to very much like the limelight.
According to local contacts, Carlos Alexandre, is probably the most famous judge in Portuguese history who positions himself as crusader to shortcut a path to an ego-driven career. Sound familiar?
He recently slapped a huge bond on one of Portugal’s most successful Álvaro Sobrinho, who owns Sporting Lisbon football club and who has been tried by the media for years but always cleared in the courts.
Alexandre also made judgements for people running the aforesaid golden visa. But his decisions were reversed immediately in a superior court.
This type of infrastructure spooks investors. One such unnamed source didn’t sit on the fence.
“For investors driven to the Portuguese honeypot of tech nirvana, these examples of selective and ineffective justice are very dangerous. No point being the home of a tech revolution if investors can be unfairly tried in public by a justice system based on prejudice, or race, or at least ego driven maniacs”, he/she/it/them said.
Naturally successful exits and even TGEs such as that of Sweatcoin will only cement Portugal’s reputation as the place to be, but if Sporting Lisbon’s owner Álvaro Sobrinho can be dragged through the courts, that sounds more like the antiquated justice system of India where justice sometimes takes decades… not a tech Utopia
For smaller entrepreneurs in the crypto space, promises of preferable tax status will ring hollow if draconian laws are passed, which will lead to an exodus of talent to other more efficient cities offering real value.
I hear Copenhagen is nice at this time of year!
Monty Munford is a tech journalist and an advisor for the DeFi privacy organisation Sienna Network and in the past decade has helped more than 40 companies raise money and exit for a total of £1.4 billion.
He is also a keynote speaker/emcee/moderator/interviewer at prestigious events around the world and has spoken at more than 200 global events interviewing figures such as Tim Draper the late John McAfee, Sir Tim Berners-Lee, Steve Wozniak (twice in Beirut and Vienna), Kim Kardashian (once in Armenia), Amitabh Bachchan, Ghostface Killah, ZZ Top, Guns N’ Roses and many others.
He was previously a weekly tech columnist for Forbes in New York, the Telegraph in the UK and continues to write regularly for the BBC, The Economist, The FT and… City PM.