Supplied<\/span><\/span><\/span>)<\/cite><\/figcaption><\/figure>\nShe said Satoshi Island was just one in a “long line” of naive cryptocurrency projects set on tropical islands.<\/p>\n
“There’s been a lot of energy and money put into convincing people that this is the future of technology, the future of the web, the future of society,” she said.<\/p>\n
“A lot of that really just doesn’t stand up to scrutiny. But it does work very well for convincing people to put their money into it.”<\/p>\n
Ms White said\u00a0“less-glamorous” aspects \u2014 such as\u00a0waste management on a remote island, food distribution and even electrification \u2014 were not considered in many crypto island plans.\u00a0<\/p>\n\n\n
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Satoshi Island’s homes have been developed by\u00a0Hong Kong-based architect James Law.(Supplied: Satoshi Island<\/span><\/span><\/span>)<\/cite><\/figcaption><\/figure>\nBlockchain as an ‘exit from nation states’<\/h2>\n Ellie Rennie, from RMIT University’s blockchain innovation hub, said there was potential for\u00a0blockchain technology to re-imagine how societies might operate.<\/p>\n
“They’re often talking about the possibilities of automating certain functions of the state,” Professor Rennie said.<\/p>\n
“Many of those tasks can be done through technologies more efficiently\u00a0and, so, that raises the possibility of alternative societies forming and alternative nations.”<\/p>\n
However, she added, it was “too early” to predict if any of the proposed cryptocurrency utopias would work, and with that uncertainty there was risk.<\/p>\n
“In some cases, they are experiments in\u00a0doing things differently. They’re a form of exit from nation states,” she said.<\/p>\n
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“The problem is that others can pick up on these narratives and hopes and ideologies and exploit them for financial gain.”<\/p>\n<\/div>\n\n\n
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Professor Ellie Rennie has urged investors to be cautious.\u00a0(Supplied: Ellie Rennie\u00a0<\/span><\/span><\/span>)<\/cite><\/figcaption><\/figure>\nPrivate land sales ‘not possible’<\/h2>\n At the moment, the island \u2014\u00a0called Lataro by locals \u2014\u00a0is an unruly, tropical forest.<\/p>\n
It’s about 800 acres, a bit bigger than Sydney’s CBD,\u00a0and “90 per cent untouched by man”, according to a real estate notice advertising the island.<\/p>\n
The island is mostly uninhabited, but a family of Indigenous landowners have ultimate custody of the land, and can lease it out to companies such as\u00a0Satoshi Island to develop and use.<\/p>\n
Philip Warele negotiated the deal with Denys Troyak and the Satoshi Island company.<\/p>\n
He does not know much about cryptocurrency but is optimistic about the opportunities that Satoshi Island offers.<\/p>\n
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“We knew it would improve the economy of Vanuatu and bring money into the country,” he said.<\/p>\n<\/div>\n\n\n
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Philip Warele says his land can only be leased, not sold.\u00a0\u00a0\u00a0(Supplied: Phillip Warele<\/span><\/span><\/span>)<\/cite><\/figcaption><\/figure>\nMr Troyak and the team have employed around 10\u00a0members of his family, and Mr Warele says another 10\u00a0will join the team soon.<\/p>\n
The company also made payments to Mr Warele’s family \u2014\u00a0another reason why he says he is happy for the partnership.<\/p>\n
As to whether Satoshi Island investors can buy physical property with cryptocurrency, Mr Warele said that would be impossible.<\/p>\n
“My understanding is that they’re not selling plots, but they’re just renting out the plots,” he said.<\/p>\n
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“There’s one man who has paid for a lease, so we have an agreement with him. But, for him\u00a0to sell land inside the island, that’s not possible.”<\/p>\n<\/div>\n\n\n
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According to local reports, 90 per cent\u00a0of the island used to be\u00a0a Conservation Reserve for Vanuatu’s\u00a0endangered coconut crab.(Supplied: Satoshi Island<\/span><\/span><\/span>)<\/cite><\/figcaption><\/figure>\nMr Troyak told the ABC “one cannot own land in Vanuatu” and “NFT holders have exclusive rights to the blocks of land on Satoshi Island”.\u00a0<\/p>\n
But he did not elaborate on why the company’s website and promotional material states “anyone can own a piece of the island”.<\/p>\n
Is it a scam?<\/h2>\n Although they don’t\u00a0give any property rights to customers, the asking prices for Satoshi Island Land NFT Deeds range from\u00a0$900 to $11,000.<\/p>\n
In January, the Vanuatu Financial Services Commission (VFSC) issued a public notice which said the operation “could be a scam”.<\/p>\n\n\n
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A notice issued by the Vanuatu Financial Service Commission.(Supplied:\u00a0Vanuatu\u00a0Financial Services Commission<\/span><\/span><\/span>)<\/cite><\/figcaption><\/figure>\nThe financial services regulator said that, because Satoshi Island did not have a licence to trade in digital assets, what it was advertising online was false and misleading.<\/p>\n
A few months later, Satoshi Island claimed the notice was damaging to their business and took legal action against the\u00a0commission.<\/p>\n
VFSC said\u00a0it had to remove the notice while the case was pending, and that the matter was still before the Vanuatu courts.\u00a0<\/p>\n
Mr Troyak did not respond to ABC’s questions about why his company took legal action against the VFSC.<\/p>\n
In February, Vanuatu’s acting financial minister, Johnny Koanapo Rusao, told the ABC he supported\u00a0Satoshi Island in principle, but said that Vanuatu’s legislation needed to be updated to provide adequate oversight on the project.<\/p>\n
“We need to have legislations updated so they can absorb the implementation of the cryptocurrencies,” he said.<\/p>\n
Mr Troyak said Satoshi Island’s legal team were ensuring the project would be lawful.<\/p>\n
“We feel very strongly that the legislations of the Vanuatu government will come through, and it’s going to be friendly to us,” Mr Troyak said.<\/p>\n
“We’re going to make sure we go through to our lawyers locally, and make sure everything is clear.”<\/p>\n
Professor Rennie said there was a “clear precedent” of cryptocurrency schemes making promises they they could not fulfil, and urged potential investors to be cautious.<\/p>\n
“There’s a very fine line between a scam and a failed business project,” she said.\u00a0<\/p>\n
“Ultimately, it’s up to anyone who is interested in participating in these things\u00a0to look very, very closely at what they think it is, and to know the risk.”<\/p>\n
‘Flexible’ laws and murky ownership rights<\/h2>\n According to Vanuatu’s land management department, Mr Troyak and his team do not\u00a0have the rights to Lataro Island.<\/p>\n
In lease title documents obtained by ABC, the Satoshi Island company is directed by Theresa\u00a0Jane Allen, a long-time property developer in Vanuatu.<\/p>\n
The ABC was unable to contact Ms Allen, and her name is not listed on Satoshi Island’s website, promotional material, nor on any of the company’s NFT land agreements.<\/p>\n\n
Mr Troyak said Ms Allen was “not part of the Satoshi Island team”, and\u00a0said Satoshi Island’s\u00a0Land Deed NFTs were sold by another organisation,\u00a0registered as a non-profit in the\u00a0Marshall Islands.\u00a0<\/p>\n
He did not answer questions about\u00a0who financially benefits from the Satoshi Island project.<\/p>\n
Despite\u00a0lack of clarity around the company’s ownership,\u00a0legal experts say\u00a0it is unlikely the company would face\u00a0barriers in Vanuatu’s courts.<\/p>\n
Vanuatu lawyer Didier Hamel-Landry said that, as long as investors were clear they could not buy Vanuatu land using NFTs, Satoshi Island’s activities were lawful.<\/p>\n