Próspera

Based on Wikipedia: Próspera

Imagine a place where you can pick your own laws from a menu. Where Bitcoin is official currency. Where robots build homes from wooden blocks in something called "The Circular Factory." Where a private company sued an entire nation for ten billion dollars—roughly a third of that nation's entire economic output.

This place exists. It's called Próspera, and it sits on a small Caribbean island off the coast of Honduras.

A City That Writes Its Own Rules

Próspera isn't just another special economic zone, those designated areas where countries offer tax breaks to attract foreign investment. It's something far more radical: a private city with its own legal system, its own tax code, and its own governance structure—all operating within the borders of a sovereign nation that now wants it gone.

To enter Próspera, you pass through gates staffed by armed guards. They hand you a clipboard. You sign what they call a "temporary touristic access permit," agreeing to abide by the community's legal code. You're no longer playing by Honduras's rules. You're playing by Próspera's.

The city offers businesses an extraordinary deal: a one percent tax on revenue, a five percent tax on wages, and a two-and-a-half percent sales tax. Compare that to typical corporate tax rates of twenty to thirty percent in most countries. But here's the really unusual part—businesses operating in Próspera can choose which legal framework governs them. They can select regulations from approved foreign jurisdictions, propose their own custom regulations for approval, or operate under common law principles developed over centuries in English courts.

It's like choosing your own adventure, except the adventure is which country's commercial code you'd prefer to follow.

The Intellectual Roots: Charter Cities

The idea behind Próspera didn't emerge from nowhere. It traces back to a Nobel laureate named Paul Romer, who served as chief economist at the World Bank. Around 2012, Romer proposed something he called "charter cities"—entirely new urban areas built with governance structures designed from scratch to attract investment through strong rule of law, economic freedom, and regulatory efficiency.

Romer's logic was compelling. Many developing countries struggle with corruption, weak institutions, and unpredictable legal systems. These problems make investors nervous and keep capital away. But what if you could create a fresh start? A new city with new rules, operating like a startup company rather than inheriting centuries of institutional dysfunction?

The theory attracted serious attention. A Washington, D.C.-based organization called the Charter Cities Institute formed to promote these ideas worldwide. And Honduras, one of the poorest countries in the Western Hemisphere, proved receptive.

But here's where theory collided with practice. Romer himself now rejects what Próspera has become, describing it as "living in this libertarian fantasy that they can be free of the government. That's not gonna turn out well."

The father of charter cities has disowned his most famous offspring.

How Honduras Got Here

The legal foundation for Próspera emerged through a decade of political maneuvering and constitutional changes.

Honduras first attempted something similar with Special Development Regions, known by their Spanish acronym REDs. These zones would have been administered by developed guarantor countries rather than private companies. But Honduras's courts struck them down as unconstitutional—they violated national sovereignty by ceding too much control to foreign powers.

The concept didn't die. It evolved.

In 2013, under President Porfirio Lobo, Honduras amended its constitution to allow something called Zones for Employment and Economic Development—ZEDEs in Spanish. These zones function as subnational territories with extraordinary autonomy. They maintain their own administrative systems, their own laws, their own way of doing things. President Juan Orlando Hernández championed these special economic zones throughout his tenure.

Hernández would later face his own legal troubles. In 2024, a U.S. federal court convicted him of drug trafficking, conspiracy, and weapons charges. He received a forty-five-year prison sentence. The president who enabled Próspera's creation spent the end of his career defending himself against accusations of narco-state corruption.

This context matters for what came next.

The Venezuelan Dreamer

Erick Brimen grew up in Venezuela, watching his country descend from Latin America's wealthiest nation into economic catastrophe under Hugo Chávez and Nicolás Maduro. Hyperinflation. Food shortages. Mass emigration. The collapse of institutions.

Brimen became a wealth fund manager. He founded a company called NeWay Capital. And he conceived of Próspera as what he calls a "poverty relief initiative"—a way to create prosperity in a region where governments had failed their citizens.

In 2017, Brimen formally applied for a charter city in Honduras. He used intermediate companies with names like Brimont Holding and North Shore Development Company to acquire land on Roatán, a tropical island known for its coral reefs and dive tourism. He also purchased property on the Honduran mainland.

The backers who joined him read like a who's who of Silicon Valley libertarianism. Peter Thiel, the PayPal co-founder who's invested in everything from Facebook to space technology, put money in. So did Marc Andreessen, the venture capitalist behind Andreessen Horowitz. Balaji Srinivasan, a former Coinbase executive who wrote a book called "The Network State" about creating new countries from scratch, also invested through a venture capital firm called Pronomos Capital.

In January 2025, Coinbase's CEO Brian Armstrong announced his company's venture capital division would invest in Próspera to "grow financial inclusion and innovation."

Construction began in 2021. German architect Patrik Schumacher designed the initial buildings. By 2025, the project featured automated manufacturing—those robots turning wooden blocks into construction materials that sound like science fiction but apparently exist.

What Actually Happens There

Próspera hosts conferences. In 2024, biotech startup events attracted one-and-a-half million dollars in venture capital investments. One conference theme: "Make death optional"—the transhumanist dream of extending human lifespan indefinitely. In February 2025, they held a "crypto cities summit."

Bitcoin is legal tender within the city's boundaries, placing Próspera in rare company with El Salvador, which adopted Bitcoin nationally in 2021.

The governance structure reveals where power actually lies. A council of nine members runs things: five elected, four appointed by Honduras Próspera Inc., the private company behind the project. Decisions require a two-thirds majority. Do the math. Honduras Próspera Inc. controls four of nine seats. No decision can pass without at least some of those four votes.

The company has veto power over its own city.

Above the council sits something called the Committee of Best Practices, an unelected body appointed by the Honduran government. They approve internal regulations and provide policy guidance. But with the current government trying to shut the whole thing down, this oversight mechanism has become the subject of bitter legal dispute.

The Neighbors

Crawfish Rock is a small village that directly abuts Próspera. The contrast tells a story.

When drawings of Próspera's later development phases appeared on the project website, residents of Crawfish Rock noticed something alarming: the plans included parts of their village. This sparked fears of expropriation—the government seizing private land for public or private development. Próspera's charter explicitly prohibits land expropriation within its boundaries, and Brimen has publicly supported making expropriation illegal nationwide. But the fear persists.

Próspera is supposed to contribute to Honduran development. Eighty-eight percent of revenue stays with the city; the rest goes into a trust for spending on Honduran projects. But the roads in Crawfish Rock remain unpaved. Disputes over groundwater rights and sewage problems continue. Próspera uses Roatán's garbage dump, electricity grid, and airports—shared infrastructure with what critics describe as inequitable terms.

The promise was that a rising tide would lift all boats. The neighboring fishing village is still waiting for the tide to reach them.

The Ten Billion Dollar Lawsuit

When Xiomara Castro ran for president in 2021, repealing the ZEDE law was a centerpiece of her campaign. She won. In April 2022, she signed legislation to kill the zones.

Castro didn't mince words. She called Próspera a creation of a "narco-regime"—a reference to the drug trafficking allegations that would eventually land former President Hernández in a U.S. prison. She declared self-governing ZEDEs unconstitutional.

Próspera didn't close. Instead, it sued.

Honduras Próspera Inc. claimed its ZEDE agreements guaranteed legal stability for fifty years. The repeal, they argued, violated that commitment. They filed for international arbitration seeking up to ten-point-seven billion dollars in damages.

To understand how enormous that number is: Honduras's entire gross domestic product—the total value of all goods and services produced in the country—is roughly thirty billion dollars. The lawsuit demands more than a third of the national economy.

In July 2022, the U.S. State Department weighed in, expressing concerns that repealing the ZEDE law might violate international trade agreements, including the Dominican Republic-Central America Free Trade Agreement, known as DR-CAFTA.

The pressure campaign didn't stop at legal filings.

Lobbying Washington

Brimen spent hundreds of thousands of dollars lobbying U.S. legislators. The goal: pressure Honduras through American power. Proposed measures included sanctions on Honduras and cuts to U.S. aid if the Honduran government didn't allow Próspera to continue operating.

U.S. Representative Steven Horsford advocated for denying visas to Honduran government officials if Honduras didn't do as Próspera wanted. Brimen had donated five thousand dollars to Horsford's campaign in 2023. The 2024 U.S. House budget included provisions to pressure Honduras on ZEDEs.

U.S. Representative María Elvira Salazar, a Republican from Florida, declared: "Socialists once again show that they are more interested in their own power and ideology than in the prosperity of their country."

The framing positions Próspera as free-market innovation fighting socialist overreach. From Honduras's perspective, a foreign company is using another country's government to override sovereign decisions made by democratically elected leaders.

The Arbitration Ruling

In 2024, the case reached the International Centre for Settlement of Investment Disputes, known by its acronym ICSID. This body, part of the World Bank Group, arbitrates disputes between countries and foreign investors.

Honduras argued that Próspera should have exhausted domestic legal remedies—gone through Honduran courts first—before seeking international arbitration. The tribunal rejected this argument, finding it a matter of admissibility rather than jurisdiction.

The ruling pointed to a contradiction in Honduras's position. The country's law required investors to exhaust local remedies while simultaneously forcing them to waive their right to pursue local proceedings before arbitration. You can't demand both.

Honduras had inserted this requirement into domestic law back in 1988, but it was never recognized in ICSID treaties or DR-CAFTA. The tribunal said Honduras couldn't invoke a domestic rule that contradicted its international obligations.

The ten-point-seven billion dollar claim could proceed.

Honduras responded dramatically. In August 2024, the country withdrew from ICSID entirely. They would no longer participate in this international system for resolving investment disputes. Critics worry this signals broader retreat from international investment agreements, potentially scaring away foreign capital Honduras desperately needs.

The Honduran Supreme Court also weighed in, declaring ZEDEs unconstitutional with retroactive effect—meaning the zones were illegal not just going forward, but had always been illegal.

What Kind of Experiment Is This?

Canadian historian Quinn Slobodian studies the intersection of capitalism and political organization. He places Próspera within a broader pattern: projects aimed at implementing libertarian theory in practice.

The libertarian dream has always included escaping government constraints. Seasteading—building floating cities in international waters beyond any nation's jurisdiction—attracted serious money and attention. Charter cities represent a terrestrial version: carving out spaces where conventional state power doesn't apply.

Supporters see Próspera as proof of concept. Here's a place with streamlined business regulations, minimal taxation, private dispute resolution, and legal frameworks chosen by the parties involved rather than imposed by distant bureaucrats. If it works, it demonstrates that different rules produce better outcomes. Capital will flow. Jobs will follow. Prosperity will spread.

Critics see something darker. A wealthy foreign company, backed by billionaire investors, established a quasi-sovereign territory within one of the Western Hemisphere's poorest countries during a presidential administration later convicted of drug trafficking. Now that country's democratically elected government wants it gone, and the company is using American political power and international legal mechanisms to override that democratic choice—while suing for an impossible sum that would cripple the national economy.

The divergence in interpretation is total. Same facts, opposite conclusions.

The Unresolved Questions

As of 2025, Próspera continues operating despite ongoing legal disputes. The buildings stand. The conferences happen. Bitcoin circulates. The robots reportedly still build.

But fundamental questions remain unresolved.

Can a private entity establish what amounts to a state within a state? What happens when such an entity's interests conflict with the host nation's sovereignty? How should international law balance investor protections against democratic self-determination? When does a "poverty relief initiative" become, in effect, a colonial enclave?

Paul Romer proposed charter cities as a way to help developing countries escape institutional traps. He imagined new cities governed by developed countries with strong institutions—Canada administering a zone in Honduras, perhaps, bringing rule of law and regulatory competence. What he got instead was a venture capital-backed private company claiming fifty-year immunity from the democratic decisions of the country hosting it.

The libertarian fantasy, as Romer calls it, assumes that freedom from government produces good outcomes. But Próspera isn't free from government—it's invoking the power of governments, international treaties, and legal systems when it suits its interests. The company uses trade agreements, U.S. political pressure, and World Bank arbitration mechanisms. It just doesn't want to be subject to Honduran democracy.

That selective relationship with state power—welcoming it when protective, rejecting it when constraining—might be the most interesting thing about the whole experiment.

Where This Goes

The arbitration proceedings will unfold over years. Honduras, having withdrawn from ICSID, has complicated its own legal position. Próspera, continuing to operate, creates facts on the ground. The nearby villagers of Crawfish Rock watch and wait, their roads still unpaved, their water rights still uncertain.

The broader charter city movement watches too. Other projects exist or are planned in various stages of development around the world. What happens to Próspera will shape what investors, governments, and communities think is possible—or permissible.

Technology investors often speak of disruption with admiration. Uber disrupted taxi cartels. Airbnb disrupted hotel regulations. Perhaps Próspera represents the ultimate disruption: nation-states themselves.

Or perhaps it represents something else entirely—a reminder that the rules governing human societies exist for reasons, that sovereignty means something, that democratic choices carry weight even when they inconvenience people with resources to fight back.

The Caribbean island where this drama unfolds is known for beautiful coral reefs, world-class diving, and now, an argument about the future of governance itself. The robots keep building. The lawsuits keep multiplying. The questions remain unanswered.

Próspera exists in a legal limbo, both present and contested, operational and potentially void, innovative and arguably neocolonial. It's a mirror reflecting back whatever you bring to it: libertarian beacon or corporate overreach, poverty relief or extraction, the future of cities or a cautionary tale about what happens when theory meets reality on someone else's land.