The Bitcoin citadel that is being consolidated in Roatán, one of the Bay Islands of Honduras, is at risk of disappearing, now that the Supreme Court of Justice (CSJ) of the country made the decision to repeal the Special Economic Development Zones (ZEDE) for considering them unconstitutional. The measure was taken 10 months after the National Congress of Honduras met to repeal the decrees that allowed the creation and existence of the ZEDE. In one of these spaces, considered by many as model cities, Próspera is developed, a charter city or autonomous territory in which a circular bitcoin economy is promotedwith the digital asset not only as legal tender, but also as a unit of account. So due to the importance of bitcoin in Roatán, where there is also a center for learning and promoting the adoption of the pioneering digital currency, the Honduran citadel quickly emerged as one of the most important in Latin America. Others such as Bitcoin Beach from El Salvador, Bitcoin Jungle from Costa Rica and Praia Bitcoin from Brazil also have weight in the region. The thousands of bitcoin citadels that exist in the world face challenges, since they are barely projects that seek to grow and achieve their objectivesbut none is at risk of being expropriated, as could happen with Roatán, if Xiomara Castro's government decides so.
#QhuboTV | «We ask that the decision that was made be reconsidered, since it is harmful to the country, the affected families are not being thought of, all because we want to fulfill a commitment of the presidency, but not considering the collateral effect,» the Manager of… pic.twitter.com/e8HwXCbSzw— Q'hubo Official TV (@Qhubotvoficial) October 7, 2024
As reported by local media, the CSJ must rule on the status of jobs granted to Hondurans by companies installed in the ZEDE. This is because, according to the opinion of some jurists, the operations of these companies must be respected since they are protected by international treaties signed by the government of Honduras. The ZEDE of Próspera, which brings together several foreign companies, generates at least 3,000 jobs. Among them are those generated by the company AmityAge, which promotes education about bitcoin in Roatán and promotes tourism in the region. Fidel Fúnez, a Honduran and one of the Amity Age educators, classified the CSJ's decision as an «attack» on the bitcoin citadel. «I am a witness of how the education we provide is admirably impacting the lives of students in Roatán. “If it weren't for Próspera, there would be no Amity Age in Honduras!” he said.
As a result of the attack it is currently suffering @ProsperahnI decided to share my testimony. I am a witness of how the education we provide is admirably impacting the lives of students in Roatán. If it weren't for Prospera,@AmityAge It wouldn't exist in Honduras! pic.twitter.com/b94pAxeIHh— Fidel Fúnez C. (@fidelfunez) September 27, 2024
A heated debate that splashes a Bitcoin City
The Roatán citadel, also known as Bitcoin City, began construction in 2020 after businessmen committed to its development relied on national laws that allowed them to convert certain areas of the national territory into «special regimes.» In them, the investors would be in charge of the governance of the area, autonomously. The bases for the creation of the ZEDE became laws in 2011 and then became the key to the promises for the re-election of then-president Juan Orlando Hernández, who, in order to win the 2017 re-election, averaged creating 600,000 new jobs for Hondurans.
The idea to achieve this was to «take a leap in attracting capital» and its springboard would be the ZEDE. However, the special zones were born in the midst of controversy, with some politicians calling them «anarchic territory», outside the framework of Honduran law. By then, the Supreme Court of Justice had come out against the creation of the so-called «model cities» by declaring the 2011 Law unconstitutional. Despite this, in December 2012, the legislature took drastic measures by ordering the dismissal of four of the six magistrates of the Constitutional Chamber who had frustrated the project.
Próspera is the only jurisdiction in the world that has bitcoin as legal tender and as a unit of account. Source: X/AmityAge. Subsequently, and after making some minor reforms, in June 2013, Parliament approved the Organic Law of the Employment and Economic Development Zones, shortly before Juan Orlando Hernández was re-elected as president of Honduras. Her successor, Xiomara Castro, later promised to eliminate the ZEDE when she became president. And now when the CSJ has declared the ZEDE unconstitutional, some users of the social network They question the State for “the disaster we have” (6 out of 10 households live in poverty in the country). For this reason, he asks the Honduran Undersecretary of Finance, Roberto Carlos Ramírez, to look at alternative models that are yielding good results in other places. «A circular economy based on bitcoin is a model that should be replicated in the rest of Honduras: +Employment -State = Success,” says the user.
Bitcoin already has Honduran roots
In any case, the repeal of the laws that support the ZEDE is being done in the midst of a climate of legal uncertainty. This is taking into account that the CSJ's decision has generated conflicting opinions regarding the interpretation of the Constitution of the Republic and the possibility of reforming its articles considered intangible or «stone», which are laws or norms so solid and fundamental that They cannot be easily repealed or modified, as lawyer Joaquín Mejía Rivera points out. Mejía stressed that the Supreme Court's ruling does not violate the Constitution, but rather seeks to «reestablish the legal order,» since he considers that the creation of the ZEDE was the result of a process that did not comply with the requirements established by the fundamental law. The specialist in constitutional law believes that after the decision of the CSJ, The Honduran authorities have to clarify the ZEDE and that what the companies that occupy Honduran territory are doing be resolved legally and in practice. Mejia believes that it is best for the government to request all the legal documentation that they have acquired over the years, from environmental licenses to municipal permits, all the documentation that an investment has. In such a way that they review the constitution of these projects to ensure that they are acting in accordance with other national laws and, if necessary, that they close operations. Additionally, it is believed that with the decision of the CSJ, what will come next is the expropriation of investments in these special economic zones, to stop its definitive advance. Meanwhile, the debate among jurists continues. The discussions are representative of a broader struggle to define the limits of power in Honduras, as well as respect for the Constitution as the supreme norm. However, the debate intensifies when the economic impact of the ZEDE is mentioned, where there are not only more than 3,000 jobs at stake, but also an investment that exceeds 150 million dollars. Representatives of the private initiative maintain that this decision of unconstitutionality not only affects the rights of investors, but can also cause a cascading effect on the economic stability of the country, as well as for the community that revolves around bitcoin in Latin America. .
At the AmityAge Bitcoin academy in Roatán they update the exchange from dollars to bitcoin. Source: X/AmityAge. However, while what will happen to the special economic zones is being defined, what is It is definitive that the adoption of bitcoin already has roots in Hondurassince it will be impossible to take back the learning that adults and children who live in Roatán have acquired. where education on the pioneering digital currency will surely continue to advance. It is something that many see as increasingly important, since the Central Bank of Honduras prohibited banks from operating with bitcoin and other cryptocurrencies.