Blockchain’s Failed Cities: Utopian Dreams Meet Harsh Realities

For more than a decade, the blockchain industry has tried to create its version of a “city on a hill”—self-sustaining communities where blockchain serves as the foundation and code replaces law. Yet, despite ambitious visions, most of these projects have struggled under the weight of regulation, economics, and political realities.

Some initiatives took a pragmatic approach, using blockchain as a land registry. Others were more radical, seeking to build entire societies governed solely by crypto. From cruise ships turned into Bitcoin havens to planned smart cities across Africa and the Middle East, each project has told a cautionary tale about the collision between blockchain ideals and real-world limitations.

Dreams at Sea: The MS Satoshi

In 2020, three Bitcoin entrepreneurs purchased a decommissioned cruise ship with hopes of transforming it into a floating Bitcoin city off the coast of Panama. The vessel, renamed MS Satoshi, promised a haven for digital nomads where Bitcoin would serve as legal tender and residents could live free of government oversight.

Despite its restaurants, gyms, and proposed “floating seapod homes,” the project quickly sank under crushing fuel costs of $12,000 per day, pandemic disruptions, and the harsh reality of maritime law. Within months, the dream was over, and the ship was sold.

Trump’s “Gaza Riviera” Proposal

One of the most controversial recent examples emerged in 2025, when reports surfaced that former U.S. President Donald Trump was considering a plan to redevelop Gaza under American custodianship. The blueprint included a tokenized property investment scheme that would allow Palestinians to exchange land for relocation or new housing in planned “smart cities.”

Critics swiftly condemned the plan, with UN experts warning it served as a geopolitical cover rather than a humanitarian effort. The project has since stalled, caught between international law and political backlash.

Liberland: A Libertarian Microstate

Unlike failed seasteads and megaprojects, Liberland remains one of the longest-running blockchain experiments. Founded in 2015 on unclaimed land along the Danube River, the self-proclaimed Free Republic issues its own cryptocurrency, the Liberland Dollar.

The project has faced consistent opposition from neighboring Croatia, which has blocked settlers from accessing the land. Still, Liberland has attracted crypto libertarians worldwide and continues to promote its vision of minimal government and blockchain-based governance.

CityDAO: Blockchain Meets the Wild West

In 2021, Wyoming recognized decentralized autonomous organizations (DAOs) as legal entities, inspiring the creation of CityDAO. The group raised millions through NFT sales and purchased 40 acres of land to build a blockchain-managed community.

But enthusiasm waned after internal disputes, a $95,000 Discord hack, and restrictive zoning laws that allowed only one single-family home on the land. CityDAO broke legal ground by forming the first recognized DAO entity, but its utopian goals fell far short.

Akon City: A Star’s Futuristic Dream

Senegalese-American musician Akon announced plans in 2020 for a $6 billion “Akon City,” a futuristic metropolis powered by his cryptocurrency, Akoin. The city was supposed to feature hospitals, universities, and skyscrapers along Senegal’s coast.

Years later, the project remains stalled. The COVID-19 pandemic halted progress, Akoin’s value collapsed, and the Senegalese government pressured Akon to either build or relinquish the land. By mid-2025, the project was officially abandoned.

Blockchains LLC’s Nevada Desert City

In 2021, Blockchains LLC purchased more than 67,000 acres in Nevada, hoping to create a blockchain city where everything from taxes to medical records would live on-chain. The ambitious plan required a new “innovation zone” law that would grant the company quasi-governmental authority.

The proposal faced widespread opposition from lawmakers, environmentalists, and local communities. Without political support and with water access tied up in regulatory battles, the project dried up before construction began.

Liberstad: A Modest but Real Success

In contrast to the high-profile failures, Norway’s Liberstad has quietly succeeded. Founded in 2015 on anarchist and voluntaryist principles, the community occupies 150 hectares near Kristiansand. Land was originally purchased with Bitcoin, and the settlement operates its own currency, City Coin.

Liberstad now has permanent residents, its own blockchain infrastructure, and a functioning local economy. While small in scale, it stands as one of the few blockchain-inspired communities to deliver on its promises, proving that sometimes, modest ambitions fare better than grandiose visions.

The Future of Blockchain Cities

From luxury crypto enclaves to anarchist communes, blockchain’s attempts to create physical societies have revealed the tension between ideology and reality. While the dream of a decentralized “city on a hill” persists, most experiments have failed under financial, legal, or logistical pressures.

The lesson appears clear: blockchain can enhance governance and finance, but when it comes to building entire cities, it has yet to overcome the forces of politics, regulation, and economics.