Charter Cities and Network States: an Introduction to the Nations of the Future with Niklas Anzinger
what I often use as an analogy for Network States and Charter Cities they're like operating systems. So imagine that existing states and governance providers are an MS-DOS operating system. Some of them are even older and they have like hard coded language in Cobalt or something like that.
So these places you can't build high performance super apps on top of these auto operating systems. So what I see Prospera and other Charter Cities and Network States are doing is building a new kind of Apple IOS. My thesis is that companies can build better or we can build better super apps on top of these operating systems.
Hello and welcome to Polyweb. I'm your host Sara Landi Tortoli, and my guest today is Niklas Anzinger. Niklas is founder and general partner at Infinita, the first ever Prospera based VC fund. And the host of the podcast Stranded Technologies In our conversation, we talk about how new cities and societies can be built in the age of the internet, and we explore the concept of Charter Cities and Network States.
Please enjoy this conversation with Niklas Anzinger. Welcome to Polyweb. Sara, it's great to be here. thank you very much for accepting the invitation, and, uh, this is an episode that I'm also super curious about. So I cannot wait literally to ask you all sorts of questions related
to the topic of network, state and building a new nation. And actually maybe a good place to start is by giving a definition. So what is a network state? Sure. So I'm gonna follow Balaji Srinivasan definition. He's the former CT O of Coinbase and the author of the book The Network State. So he is kind of coining the term and kind of the meme that we're now increasingly seeing in Web three spaces. So his definition is in one sentence, a network. Is a highly aligned online community with a capacity for collective
action that crowd fronts territory around the world and eventually gains diplomatic recognition from preexisting states. Now, that's a short version of the definition. There are longer ones, and there's a lot to say you're on to unpack about this, but that's what's himself says about it. Okay, so maybe we can be more, more specific, uh, around this definition of. what are the elements, uh, that, that make a nation state? So what are, what are the steps that you need to go through? Uh, maybe to build. Well, there's Balaji version and there's other versions, right? So in my version, what do you need to kind of have a new country, nation, city, whatever, or kind of a political entity? with autonomy, semi-autonomy is three things, or four, if she will. the three things are
a laws and regulations, right? So you have a legal. Second is you have governance services, right? So you are able to issue IDs, passwords, and you provide government services like in some places that might be support, like be a social safety net, or public goods and others. Yes. So, and the third is that, right? So when you have these three, you can then have people that use it as a platform, right? So a city or a country or a nation according to that use nothing but kind of. Service to you as a customer. It's a platform that you can use to live, to build a business, and
to work and to raise a family. Okay, so I got the free elements, laws and regulation, uh, governance, uh, services, and then last piece land. So you gotta have all these elements. Let's start maybe with element number one. Right. Lows and regulations. So how do you, I reimagine in this case, uh, a new type of regulation for a brand new state. How do I imagine a brand new regulation? So, I can give a couple of examples, right? Or, or let's just to, put it a bit in context because what I just said. Was a bit different from how, what he says a network state is. Right. So, and I can explain a bit the context
of that, right? So, why do we want to do it in the first place, right? So the idea is, as I said, that existing governance service providers or government, Aren't doing the best job all the time, right? So in Texas are from getting more expensive while the services get worse. All of us have experienced waiting lines, healthcare systems, many countries are very bad, or education systems. Housing seems to get more expensive and not approving seems to be only getting worse. And the theory, the idea is that it's rules and institutions that make the difference, right? So historically we had places like Hong Kong, like Singapore, like Shannon Zen in China, or Dubai, which worked with semi-autonomous or special economical.
Their idea was to upgrade governance in these small places initially to see what works, to experiment, and then roll it out to larger markets, right? So Hong Kong basically taught China, Hey, this is how a carbon law based system, how capitalism private property can work. Let's try that in our country in Shenzen, and that was massively successful. So we can roll, roll it out to other places as well. So that's kind of the core. The core idea behind it. but most of these places started through, mostly through lucky accidents, right? So the idea is how can we do more of that? How can we bring the learnings to best practices from Singapore, from Dubai, from Hong Kong, from Sheen? And replicated in places around the worlds that, that need it, right? So in, in developing world, in Africa and Latin America, where it's where it's most needed. So that's kind of where the idea of charter cities comes into place. So Polar Rome had its head talk
in 2009. The coin, the idea of charter cities, basically along the lines of what I just said. And since then you had, various movements and various groups, the Charter City Institute and the Z legislation in Honduras, which is gonna be something that we'll talk about a lot and increasing activity. And several, dozens, maybe hundreds of charter cities around the world. Many are in Africa, right? So the idea is that you get a partnership with the government that gives you the land and then you come as a see where the circle closes with the regulations and the government services, and you propose to the country, well this is how you kind of manage the zone. This is how you're gonna do economic development.
And that model is fine and bright, right? So prosperous Yoda, Honduras are two examples. Talent city in Nigeria and Kohi in Zambia. These are examples in the United States, you have two projects called Deak and Tip City of Telosa. Even though I'm not that deeply
informed of what's going on with those, but that's kind of the idea. This is how you can create kind of a new city or new nation. Now, this is where ba. So he, his background is, is in, is in crypto, and he's seeing many of the same problems and. He's saying, look, there's one problem with this model and the problem is it's too expensive to do it. So you need to have very deep local connections to get these kinds of agreements with governments. Right? So these agreements take off from years to get, and very few people in the world have these kinds of connections that are needed to get in steals. So enter the network state,
right? So, and that confuses people a bit because by largely doesn't talk much about the context that I. But he's saying, what if we can do that model upside down, flip that model on its head upside down. So instead of starting with that public private partnership with the government, with the diplomatic recognition, how about we end with and then build a community? How about we do it the other way, route. We start with that community. We start with a community of like-minded people online. Online is a space where people that kind of have strong beliefs around what he calls a moral innovation. So society wants to have a keto, a healthy living focused community. They can find each
other there, and then they build the leverage as a community, right? So they start economic activity, they start helping each. They build services for the community. So I'm happy to talk about some examples later, but the idea is that you then get leverage. What if you had like 20,000 like biohackers in Austin? Right? So that can then le put leverage on the city council and say, Hey, we want these exemptions from these laws because we, I don't know, want to do self experimentation. So then they have that leverage to get these kinds of. Right. So the network state is basically Balaji attempts to reduce the areas to entry for more startups to kind of start or to upgrade different ways of governance. Right. And now to your question about head regulation and how you started. So again,
these are two different models. So in the one model, in the Charter City model, you have to start with very comprehensive regulat. Right. So you have to, you know, come with kind of almost a full stack system, and that's possible. There's ways to do it, right? So these places would use common law based systems. Some of them are templated. There's a legal scholar named Chan w Bell, who has an open source legal system called Iulex. So prospered the cata Digital economic zone. They're kind of
fort off of that regulatory system. There's lots to talk about when it comes to that bi largest model would probably be around, uh, would start a bit smaller and would say, let's see what we need to make that moral innovation happen. So a moral innovation, again, sort of, we want to have a state where everyone eats keto, where everyone is a vegetarian or where everyone lives. There's a van left, for example. And then look at what kind of regulations or autonomy do we need, right? What's needed and how do we get that? So these places would probably not yet need full stack legal systems.
I mean, think of it to give other examples, Balaji and the book talks often about the state of Israel. Right. So Jews were living in other places around the world and they eventually crowdfund the territory in Israel and build a nation or the morons in Utah. In Utah, right. So they were also initially a religious community that had sort of one key or had some moral motivations. Then eventually, um, were able to get recognition as a US. Okay. Makes sense. Uh, and, and it's a very fascinating experiment. I'm curious to know what's, what's your take, you know, between, uh, a Charter city and, a network state? What is your, uh, your take based on the experiments that you, you're seeing right now? And maybe this is a good moment to. Tell us what are perhaps the most successful, uh, experiment
out there for both, for both charter cities and network. Yeah, sure. I mean, just to preface that, it's totally understandable for any listener that's, uh, as of now a bit confused about this space, right? There's many different things going on, right? And much of this sounds quite out there, and many people have probably never thought about that. But again, to take a step back, why is this important? So if you think of governments or governance, As an industry, it would be the biggest industry in the world, right? It would be 30% of global gdp. D P would be what's basically government spent. Governments are governance service providers, right? So this is kind of the background and Charter Cities Network say it's whatever their idea is to upgrade governance.
What if. And, you know, creates a, where places that don't have very good rule of law and upgrade them to something that looks more like a Switzerland, right? So in this way, kind of massively increase the economic development of the country. Yet that's not something that's unprecedented. We've seen it in China, for example, that started that way, or Dubai, so forth, I don't think that this is so, so much out there. I think, to be honest with you, I think that, especially in the West, uh, but not only we kind of lost this, um, this, this vision of. Of cities and states, right? because of the way I think the political system is
designed, you know, around, uh, election that are periodical. So every five years you have election, which is great because it prevents tyranny. But at the same time, the downside I think is that most politicians. Just want to get enough done to get reelected for the next mandate. Right. And this is counterproductive when you think about a long-term vision. And so like, I think maybe charter states or network
states, uh, are a way to bring back this, uh, we need to have a vision around the city because the city is not unlike a startup or a company. Exactly. I think you're really hitting the nail on the head, right? So I think the one big advantage with democracy is that it has a mechanism to prevent terror. So it's very hard, not impossible, but very hard for a new dictator to do things that are extremely obviously bad to a majority of the people. Like that's the one thing that democracies is probably somewhat good at preventing compared to dictatorships, where that just happens very regularly that you have a me mega megalomaniacal leader who just thinks that are very obviously bad to large parts of the popul. what democracy
is not very good at is so, uh, is protection of unpopular minorities, and it's also not very good at, doing good policies, right? So politicians don't do good policies. They do policies that sound good and there's a big difference, right? Politicians care about being reelected and it's, it's very often that you need expertise to really see that something that sounds good, uh, on the face of it, for example, minimum wages or, you know, healthcare regulation. You know, everyone has a right to healthcare. . Oh, that sounds, that's what politicians say, but when you try to think it through practice, what does it mean? Very often these things are detrimental to, you know, solutions that actually work in practice. Right. And for you hear from politicians is, you know, those are the kinds of, so what if you could instead have different incentives, rights where the politicians. you can think of systems that are sort of in between more like, uh, something, a government run by a corporation, right? That has a board of directors and that has shareholders, right? And these people have self form of votes. They have to vote of exit, right? So if they
don't like the service, they go somewhere else to something that's even more democratic, right? So we have more direct democracy where you have. Liquid staking or patic boarding and things like that. So the idea is not to say one model works better than the others. It's like, hey, we now have run the experiment. We have data about what works and what doesn't work with Curran's versions of representative and popular democracy. Let's try out different versions. Yeah, absolutely. And uh, I think that the technology that we have right now give us
a, this unprecedented opportunity to really. Experiment and, and do something new. And, I'm curious about how do you go and set up, uh, such type of experiments? Maybe I can give a couple of examples I'd broadly distinguish between three kinds of, modes, right? So, One is sort of the more Balaji approach where the network or the community starts online. I think the two best examples there are Afropolitan and Praxis, right? So Praxis is centered around the value of vitality, right? And their goal is to build a new city. In the, in Europe,
in the Mediterranean, somewhere for the community. And the other one is Afropolitan and they want to fix governance for Africans. Right? So both started on or start online. Right? So, I'm, I'm a member of Afropolitan
of Praxis, so I can speak more bit more about that. . And the second category is co-living, right? So there are already co-living communities like Cabinda or like Kif over here. So these are often, sometimes they're based in the United States and have land and they build on that land and they have then have. Sort of group houses or coworking spaces in other countries, for example, Colombia or Portugal and places like that, they're kind of connected by having like one community of people who like the van Life or of digital nomads that then have access. And memberships hurts to these different places and they're offer center around an innovation for how they want to live together, right? Band life, for example, being highly mobile. And then the third one, it's what I'm personally most involved in is that actual Charter City model, right? So I'm based in what I think is the most advanced modern charter. It's called Prospera. It's another country of Honduras.
So Honduras is particularly interesting because it adopted what's probably the most or the best legal framework in the world to do charter cities, right? There's another one called Siam Moan Prosper. Siam Moan are, have quite different value propositions are quite interesting to talk about. Prosper is more for the technology industry for like very ambitious entrepreneurs, and Sudan is more for local blue collar workers, right? So that, and their value proposition is basic security services and affordable housing. So Honduras is a good example for what's possible if you kind of have or finds, the right development model and the right legal framework within a. and in the Honduran case, and that's similar to probably to other cases, you have to come as a private, or public city developer, right? You can also be part of an MGO or an international organization, I suppose.
but you can do it as a private organization. So Prospera is the Chi Delaware C Corp. Right? And the Delaware lls. Right? So the C Corp owns the ip and the more software like stack of governance services in the online platform, you can imagine a bit like Estonia, right? So Prospera actually has OBA who was building the Estonia e governance platforms, also building it for Prosper. So that's part of the Delaware, venture funded company of Prosper. Then there's a Delaware, and I'll see that functions as a holding of real estate, right? And the third entity then is Prosper, which is in, which is basically the entity that has authority over the semi-autonomous zone. And that's been granted by the Honduran government, right?
So that's what that legal framework does. So you can come as prosper with these two entities and then, An application process that in their case took a couple of years. So it's not an easy feat, sort of going back to a largest point of making that easier at reducing the various entry. But they have that now. They're an approved entity by the government that has authority, uh, over the zone with the legal status, that it has right now. Right. So it's limited, it's under hondura sovereignty and Honduran criminal law and immigration law. Other than that, prosper have the autonomy to do their own labor loss, their own business registry, their own business regulations, their own tax system, right? So that's a lot of autonomy and freedom to, well try different things. That's why I'm
so excited about it. How did you get to participate? in this project. So early on, like both in, you mentioned you are, you're contributing to Afropolitan. You mentioned right now you currently we are recording and, uh, you are in Honduras at the moment. Uh, so how did you get personally involved,
uh, in this project? And maybe you can, for listeners that would like to get involved, you can give a few suggestions along. Yeah, sure. So my background is both, I spend a lot of time in, in academia, and I like to read a lot. I like to write about a lot. I, my background is in philosophy in economics. And in public policy. So I was always thinking about these questions. I was from very early
on, always very frustrated that there doesn't seem to be much happening when it comes to politics and policy and you can't really improve things their way I want to. Right. You can't really test out new things. And then the second half after I was 26, I learned sort of the toolkit of entrepreneurship, right? So I was working for a startup. I started a startup within the startup, it's now its own. So I learned the tools of how to start
small and scale fast, right? So, and basically what I'm doing now is putting these two together, right? So I was thinking two and a half years ago, what is kind of the big dent that I want to make in the universe. Like the most pos, ambitious possible, project or company that I would create that I could think of. And then started looking around and I spent a lot of time, six months to research. He. , right?
So the startups I did before were in analytics, sort of a lot of AI and machine learning. And I was thinking, what if we could apply what I learned in healthcare? What if we could make this system vastly more efficient? And my idea is, could we create sort of GitHub, like open source platform for medical data? So right. So it was just the start of covid. What if researchers around the world could work simultaneously on solutions, That would help us, prevent future pandemics and more quickly react to public health emergencies and find solutions. Right. So the big problem with that is that I learned is, um, the system of drug approvals, right? So the f d a, uh, clinical trial system plus the patent system and IP system, and plus to some degree also the subsidization of he. these are major obstacles to building kind of a more rational and better healthcare system, right? So, if you're starting, you know, even if my solution would've succeeded, we'd be still looking at, for any new drug or treatment to go through testing for more than 10 years and costs of hundreds of millions, right? So, and that mechanism is systematically creating a bottle. We know very well that it's ethically,
anti, ethically bad and morally inefficient. I say ethically bad. so when you watched a movie, Dallas BAAs Club, right? So these, this was about people in the 1980s that were diagnosed with eights, right? So as an AIDS epidemic. So there were drugs available in France, in Israel and Germany in. The FDA said, oh, you're not allowed to take it here. And that just makes the moral situation kind of present, right? So if you tell someone, I'm not allowing you to, well take risks for your life, right? So you don't, you're taking ownership of someone's decisions of their own body, right? So we have a strong principle about bodily autonomy and informed consent and things like, So Aly, I think that's quite impermissive. There should be. It's, it's just not right. So that just means you're responsible for withholding, often lifesaving drugs from people, right? Sometimes you're also withholding drugs are not good for people. But, that's where it comes to the economic part. So economically, very inefficient. The
incentive you create for any FDA official is to be hyper. Right. So talks a lot about that. We know that for more than 50 years. So in economics have, we have something that's called public choice theory. It's just that the ones that are in power or are responsible have no incentive to listening and to changing. Right? So that goes back to we can change bad policies that are once in place. There is no such things as sunset clauses. And you know, you're creating a group of entrenched
special. That have, economic incentives to maintain the status quo. And there is no, doesn't even need to be any bad actor or malice involved, right? It's really just the incentive system that we create. And then I was thinking, what are other industries, you know, health, uh, healthcare, what else is there? So education, finance, housing, and real estate or energy. When you look closer, there's always. A similar situation, right? So there is a set of regulations that have once been passed a couple of decades ago, typically, typically after a very high profile public, incident, right? So good example is nuclear power and the regulations afterwards that support its development. And a good example is nine 11. So airline safety regulations that. Yeah, not that much necessary anymore. And infringing on your personal freedom in many ways, or, you know, patriot acts and
sort of the ability of, spy agencies. These were the result of nine 11. So these regulations were written often in haste after highly. Visible public incidents and then they're irreversible. And the development of many industries is held back by these often irreversible legislations. Why does California suffer from a housing crisis? That's completely artificial, right? That has to do be, that is because of cost, of compliance and of regulation to build housing is so high that it doesn't economically make sense to build small. to build smaller than
mobile housing that is very cheap and affordable because the costs for that are prohibitive. Right? And you can go through each of these areas and you can have a similar debate, right? So, and that's what I call kind of the base layer of society. The way we make rules, the way we make regulations is kind of fact. We know what could improve it. We know that Sunset Clauses a more common law based system and regulatory flexibility. So developing a competitive insurance market to assess regulatory risk, these are all things that we fought long and hard about that, seem very likely to work. And some of them we also have seen work. So we know that the housing manipulations are
better at Tokyo or in Houston, Texas. So we have, we have some of the real world data, but it's not able yet to put it together. Right. Sort of to run more experi. Where we can take sort of the best practices at new ideas and kind of try them out in amusements.
Right. So this is something that, stuck with me, sort of that idea space, and that's when I read about Prospera, right? So it was an article by Scott Alexander. Astro code extend is called Prospectus and Prosper. . It was a very in-depth article about Prospera. It's a long read, like you have to read at least half an hour, maybe even an hour. I read it more than 20 times almost. It's extremely well researched. It's extremely
accurate. Right. So I am, I was just imp, I was just really, really impressed and I was like, wow, this is it. This is, this already exists and this could work. So, but it also sounds too good to be. So I've gotta check this out and see with my own eyes like it's just a scam where the people behind it, what is their vision? What is their ethics? And that's when I visited last year in April, organized the first independent conference in Prospera to build Prospera Summit. And I was just really amazed by the community behind it. So it's very locally grown. There's many Hons that are involved, local Honduran
that work in the service. Educated Honduras lawyers from the mainland, who to whom it's an alternative to going to the United States and search for opportunity together with an international team like the two founders of Prospera from Guatemala, Venezuela, the president is American, that sort of have thought long and hard about how to. the right or better regulatory system that could kind of radically upgrade governance and unleash entrepreneurship in Honduras, in a country that has a lot of prime and a lot of corruption, and where it's very hard to do business. So that's a vision that I'm very aligned with and I was very convinced by the team, and I just love the community here, which is why I'm now in San Pedro.
Most people, most of the endurance that work for in Prospera are from ula, right? Most are from one university. There's least these clustering effects. And there's also many entrepreneurs in Honduras that don't yet live in Prospera, but are curious. So I wanted to celebrate my birthday with these friends and with other hundred entrepreneurs and, you know, to also send a message that we, that I'm here.
To help build that ecosystem, right? So I'm planning to make the first ever VC investment in a Honduran company, within the next two or two to four weeks actually. Wow. how is Prospera different, uh, for example than, an average city, or not even average, like, like a, I don't know, Austin or, or New York or San Francisco or like London, Berlin. is it different? well imagine it would be any of these places on, on day one or day two, right? Mm-hmm.
, these places also started small, right? So Prosper isn't get that big, right? So that's the big difference, um, between Prosper and many other places, right? So that's also, I'm more of a city person. I love bigger cities, right? I, I love Berlin, I love Austin, I love Mexico City. I would say these are my three favorite cities in the. So that's the one thing that doesn't have, and that I miss, but it does have, or almost anything else about it is absolutely amazing, right? So prosperous on an island. The island is called the Raan. So Raan has about the size of Hong Kong in land, but it's very sparsely populated. So there's about 70 to a hundred thousand people that live on Rota. The biggest industry
there is tourism. So it's a popular tourist destination. It. Paradise, coral reef, crystal clear blue water and beaches. It's just, it's just amazing. It has a solid infrastructure. It has hospitals, it has roads, uh, it has American style grocery shops and supermarkets.
So it is a very decent infrastructure already on the island. Prospera owns territory. that's discontinuous, right? So it has one central location. And that it owns land in several parts of the island and each one of the mainland in Honduras that's connected to a port, so prosperous right now, also building their airport, that central territory and Prosper is about a 15 minutes ride from the international airport in Rota. Roton as an international airport with direct flights from Miami, from Dallas, Houston, from a couple of other places, and that's continuous territory has about the size of Mon. So if you were densely populated, you could fit about 40,000 people in there. Right now, there's about 50 to a hundred people there that go in and out. Partly live in that territory and partly live in other parts of the island, but thousand jobs that are tied to prospera. So people that work remotely or work as circuit service
workers, but live somewhere else on the island. There's 130 registered business. And Prosper itself is the, the continuous territory is basically divided into two. So one is the green field. So there was lead that was previously unused and right now kind of ly. but they now have a coworking space there and several construction projects. One is called the Circular Factory. That's a. startup that's doing construction technology, so they're gonna use robotic arms and 3D printing to produce local building materials.
So they're kind of upgrading local labor, local workers and using local materials, timber to use in the construction process. Another construction proj, uh, project is the Doo Tower. So the do net tower will have 85 apartments and it will be a really nice condo. My wife and I are buying an apartment and I'm gonna move into. The other part of the continuous territory is called Pristine Bay. So Prospera bought
Pristine Bay Ready Mate. Pristine Bay is a Gulf resort, right? So it's more higher end, it's more luxurious. It has five star restaurants, hotels, resorts, and now Prospera is, it's ha has it as part of the jurisdiction. So now you see things popping up like a Montessori. Bitcoin Education Center, a crypto friendly scuba shop with a big Bitcoin lobo. And they're also planning to build, uh, the Mini Circle clinic there right now, which is a biotech startup. It's doing clinical trials on the island. So that's, so that gives you about
of gist. So I'm organizing six conferences there this year, and together with the Do Not Towers and two other Cons, residential construction projects that are going on, we could, in the best case, have about 300 to 500 people living there, physic. So, but even right now there is already a social life, right? So I have many friends there. We cook together, we go to restaurants, we go have fun or go out, uh, to a bar on the other side of the island. So there is an active social life already going on. So,for people who are interested in joining, let's say prospera, right? So are there entry requirements and, uh, Even more, what are the, the benefits of joining uh, a city like Prospera? So, so prospect can't issue passports you can have residency. There's different tiers. So you can have e residency and that
entices you to visit, although you can visit without it. If you sign like a, like a, like a social contract, almost like a agreement of coexistence, and that costs, uh, about 130, it costs $130 a year. You can upgrade that to full residency. I'm planning to do that, so e residency is super
easy. You can just sign up like on any software. Full residency is a bit harder because you also need to get hondu residents. That's a process that takes three to six months and costs a bit of money, not crazy expensive.
but once you have that, you can get full prosperous residency, which entices you to, or allows you to put your tax almost out there. So you have very low income taxes and no capital gains, taxe and prospera. So that's what I'm planning to do. That's, the big advantage of. . And the third thing is you can buy real estate and own land when you're a new resident and you can form companies so you can form an LSC and prospera and that has certain, advantages and more flexibilities.
Right. So I was just thinking the other day the three types of, people that I think would benefit most from prospera or benefiting most or are most involved are. . one is locals, right? So for local service workers that can earn more money there in higher wages and have stable jobs, right? The second one is, yeah, is entrepreneurs, right? So entrepreneurs from Honduras, from the mainland, but also international entrepreneurs. So Prospera
has the best environment in the world to do certain kinds of. That's also where my BC comes in. I see Prospera as having the best regulatory system when it comes to biotech and healthcare. Heart, certain areas in hardware and certain areas in digital assets and finance, right? So for example, if you want to start an insurance company or a bank, that's just much, much easier in Prospera. If you want to do a crypto startup, there's a much clearer set of regulations that you can. , if you want to have a regulatory sandbox for certain things, you want to experiment
under the real world. For example, you have a, we have a drone company there, so drones are a very, he heavily regulated space. In Prospera, they can start strong flights out of sight, which they can't do anywhere else. So that's the type. And then the third type is, well, if you want to invest, right? So if you want to help build it and grow the ecosystem, if you want to invest in real estate and fund, young entrepreneurs, I think these are the three use cases, right? So that's very different. it's not a taxing, right? So, or an optional jurisdiction that's not at all the intention, right? So the most important thing that Prosper is working on is creating employment and creating, a better business environment for people, right? So the advantage is much more.
On the, I think the deeper you can get involved, including physically, the more advantages it has for you if you feel you belong to any of these three brackets that I mentioned. But there's much better options if you wanna save on taxes or anything like that. Yeah, I feel like it's more like a, yeah, a new way perhaps of reimagining, uh, collaboration and society. The internet, you know, in the era of, of the internet. Because if you think about it, I keep drawing the parallel between states and uh, and organization, but all organizations, companies for organizations, I mean companies, sorry, but all companies that predate internet. now undergo this, uh, undergoing this process of having to imagine themself in the era of the internet. This happens to banks. This happens to, you know, big multinational companies
that do physical products from Coca-Cola to Nike. Um, and the states are the same. You know, they are organization that predates the internet. By, by centuries and now they kind of struggle to keep up with, with what's happening. It's
like they are being attacked, attacked, um, on multiple sides, right? You have new ways of, uh, uh, co conceptualizing money, you know, with Bitcoin, et cetera. Now we are seeing that there are starting to experiment with c d C, uh, central banks digital currency. It's kind of, uh, like, like in everything, you know, things have a start.
They have a high point and then they start to decline. And I feel like, uh, we're kind of that point for the sovereign states as we know them right now. And, uh, from talking with you, I wonder if, Other ways to interact, uh, with society and organize societies are possible. And sometimes I wonder if it's not a problem of size. So the big states, as we envisioned or as we are used to right now, maybe they are not efficient anymore. Maybe they are not anymore the right way in which we organize ourself. Maybe we need something that it's. is global, but still local enough to make us feel connected.
Yeah, yeah, yeah. what I keep saying to people is that there's not only decentralization, right? So there is both advantages to decentralization and to centralization. The advantage of having bigger cities is network effects, right? So there's more people around you that you can interact with. There's a higher diversity and variety of cultural production and goods, right? So you might have more of your friends, there might more people there. Physically that are aligned with you, but as you correctly pointed out, with the internet, we can have more of these things. Decentrally With crypto, we're decentralizing one key industry. money and finance and to some degree also legal.
Right? So that's I think one of the big changes that with sort of the blockchain. Digital assets. and also increasingly realizing that law and legal, we can put on smart contract and partly codify, and it's less and less tied to like physical territory, jurisdiction rights, the law of the internet, you, the internet, you interacting with other people, right? So you are, you know, do making transactions. You're buying and selling things. You're sharing
ownership over certain things. You're voting on things. You can all do all of that on. , but you're not separated by the physical space. Right. But the old school model is that you have one physical jurisdictions where the law, right. Law applies. Right. So blockchain and the internet is kind of decentralizing human relationships and the, the thereby also governance. Right. Yeah. Absolutely. and you know, I'm very excited about these experiments going on, uh, because
I feel that the model of, of states that we are, we are experiencing right now, it's not rising to the challenges that, that we are facing right now. They don't know how to react. . and one shift challenges that I can think of is climate change, uh, for example, where you clearly see that, you know, there is the short-term, um, gain of economic growth, et cetera. And then there is the long-term consequences of not doing anything to stop what is happening, uh, to the planet. But, you know, since it does not go over the five year horizon of
the election, Process that maybe it's someone else's problem. Maybe it's the next, uh, government problem. Not, not, no, not of the current administration. So that's why I'm so excited to see this kind of experiment and maybe to, to approach. We're approaching the, the end of the, of the, I. But there is one more question that I want
to want to ask you because you are also a general partner at uh, VC that is called Infinit. And my understanding is that infinity, invest, uh, in, you know, this type of projects, uh, in, uh, this new concept of, of nations and city and imagine kind of the way that we interact as a society. So as a vc, what are the elements that you look at to evaluate a potential investment? Yeah, sure. just to again, set the context. So for me, I, what
right? So the table stakes are, investing in entrepreneurs with a larger than life mission, right, that are extremely driven and ambitious and relentless. It was also very impossible. A very, important net space is a very sound ethical compass, right? Because many of these things that we do are in the mainstream, you know, considered controversial, right? So I had, in my podcast in epi episode 37, I had someone to your topic of climate change, who's doing so large geo, so you're selling sulfur. The ox offset par particles into the atmosphere that directly reflect the sunlight to cool the planet. That's very controversial. , right? So the people that I, so that's something that I'm, you know, very keen on already. I really, really wanna deeply understand what's their, what's their ethical and moral compass and what's their vision, beyond sort of these, table stakes. A concepts that I really like
or that I'm very keen on looking at deeply is what I. Customer hyper fluency, right? So I think, that's how you know whether someone has really, or is on the way of mastering their discipline. It's this concept of hyper fluency. So when they explain it to you, it's very clear that they thought it through. Enough to a degree that they can explain it to you in clear and simple terms in a way that you understand, even though you don't have much background and you kind of go back and forth and change some of the inputs, some of the premises, and they're immediately able to contact switch and you can clearly see that they have tons of data points that they can, they have to show you that it can work this way or not the other way, right? So most of it is around, what customer. Right, and the value they create for customers and not the technology, right? So the technology is kind of a means to an end to do, create value for customers. So that's why I call it customer hyper fluency in that technological
hyper fluency, right? So there's a lot of technological hyper fluency around, I don't know, new care or nanotechnology or, or, or whatever it is, but it has to be really centered around the value it creates for the. anything, uh, that you have seen recently that really excites you, that you think this is gonna be the next thing? Yeah. I mean, I've heard about several yet undisclosed projects for new charter cities in the Caribbean and then Africa. and some of which I'm like, oh my god, , this is gonna be so amazing. There's one in Tanzania, uh, another one in Nigeria. There's potentially another one in Zambia. I see Vitalik Brine sort of getting increasingly attracted to
that space and he is meeting with government officials in Africa. He's meeting with other network state in Charter City leaders in Africa, and he's also organizing this network stay two month long network state experiment in Monte Negro that I'm going. So I don't get what his plan, not yet what his plans or visions are, but it seems that there's increasingly a bigger, it, it attracts more smart people into the space, right? Vita Rine brings extremely smart and thoughtful people from the web three space to. sort of pay attention to this same as right. So they're, interested in Ethereum development in longevity and biohacking and public goods funding. So I was at East Denver, last week and you know,
many people there have heard or read the network states I had speaking time and had more than a hundred people come. So I'm increasingly seeing that the space is getting ified specifically because of bi. And I think that's, it's gonna attract more talent to come into this space and more capital. And this is going to, you know, bring more startups to the starting line that either start with sort of the online community biology model.
But also I have heard of several really, really cool projects that can start with the Charter City model and get free zone status in some countries with significant legal autonomy. So it's gonna be, so this is really the year for this, that, and the best time to get involved. Plus, thank you so much for sharing your, your experience and your thoughts with us, and it was a pleasure having you on the. Was my absolute pleasure. Um, hope your listeners will enjoy this and they can find firstname.lastname@example.org.
More on Twitter. My hashtag is Niklas with a k Anzinger, a n z. Yeah, we'll leave uh, all your contacts and a few of the resources that you mentioned in the show notes and the description. And with that, I will see you all next week. Bye. Thanks for having me on Sarah. Bye.
that's all from today's episode. Thank you so much for watching or listening. If you find this episode valuable, you can subscribe to our YouTube channel or to the Polyweb Podcast on Spotify, Apple, or your favorite podcast app It will be fantastic if you could leave us a rating, a review, or a comment as this really helps other listeners find the show. All the resources mentioned in this episode will be linked in the description and in the show notes. See you on the next episode, and if you cannot wait until next week, you can watch this episode right here there relates to some of the things that we talk about in this episode. Bye.