A Cryptocurrency Millionaire Wants to Build a Utopia in Nevada

STOREY COUNTY, Nev. — An enormous plot of land in the Nevada desert — bigger than nearby Reno — has been the subject of local intrigue since a company with no history, Blockchains L.L.C., bought it for $170 million in cash this year.

The man who owns the company, a lawyer and cryptocurrency millionaire named Jeffrey Berns, put on a helmet and climbed into a Polaris off-road vehicle last week to give a tour of the sprawling property and dispel a bit of the mystery.

He imagines a sort of experimental community spread over about a hundred square miles, where houses, schools, commercial districts and production studios will be built. The centerpiece of this giant project will be the blockchain, a new kind of database that was introduced by Bitcoin.

After his driver stopped the Polaris on a high desert plateau, surrounded by blooming rabbit brush and a grazing herd of wild horses, Mr. Berns, who is 56, pointed to the highlights of his dream community.

“You see that first range of mountains,” he said, pointing south. “Those mountains are the border of our South Valley. That’s where we’re going to build the high-tech park,” a research campus that would cover hundreds of acres. There are also plans for a college and an e-gaming arena.

 

It takes imagination to see what Mr. Berns sees: a futuristic community growing out of the desert near Reno.CreditJason Henry for The New York Times

 

As strange — even fantastical — as all this might sound, Mr. Berns’s ambitions fit right into the idiosyncratic world of cryptocurrencies and blockchains.

The blockchain began as a digital ledger on which all Bitcoin transactions are recorded. Some aficionados have grander plans. They think it could be a new way of taking power back from the institutions they believe are calling all the shots.

Just as Bitcoin made it possible to transfer money without using a bank, blockchain believers like Mr. Berns think the technology will make it possible for ordinary people to control their own data — the lifeblood of the digital economy — without relying on big companies or governments.

There is a fuzzy line between these utopian visions and get-rich-quick schemes. Several cryptocurrency projects have been shut down by regulators; apparent hucksters have been arrested, and a plan to transform Puerto Rico with cryptocurrencies has been criticized as nothing more than a bid to take advantage of the island’s status as a tax haven.

Mr. Berns was drawn to Nevada by its tax benefits, including the lack of income taxes. And the breadth of his ambitions certainly raises the risk of a boondoggle.

 

So far, there isn’t much to see of the community envisioned here, other than an office building and digs by surveyors.CreditJason Henry for The New York Times

 

But he is different from his crypto-brethren in one big way: He is spending his own money. So far, he said, he has spent $300 million on the land, offices, planning and a staff of 70 people. And buying 67,000 largely undeveloped acres is a bit of old-fashioned, real estate risk-taking.

Still, Mr. Berns said his ambition was not to be a real estate magnate or even to get rich — or richer. He is promising to give away all decision-making power for the project and 90 percent of any dividends it generates to a corporate structure that will be held by residents, employees and future investors. That structure, which he calls a “distributed collaborative entity,” is supposed to operate on a blockchain where everyone’s ownership rights and voting powers will be recorded in a digital wallet.

Mr. Berns acknowledged that all this is way beyond what blockchains have actually accomplished. But that hasn’t discouraged him.

“I don’t know why,” he said over the roar of the Polaris engine. “I just — something inside me tells me this is the answer, that if we can get enough people to trust the blockchain, we can begin to change all the systems we operate by.”

Mr. Berns has managed to win over local officials who are eager for economic development. Nevada’s governor, Brian Sandoval, read a proclamation that named the Blockchains property “Innovation Park” at an event last month where Mr. Berns sat on a panel with the governor and Elon Musk, the chief executive of Tesla.

 

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