Should tech and crypto innovators avoid San Francisco?

San Francisco has been a technology hub for decades. The city is home to many leading crypto companies. Ripple, Coinbase, Solana Labs, Oasis Labs, Anchorage Digital, Venture Aviator, The Black Box and CoinList are all located there. But the reputation is in a downward spiral as heinous crimes make headlines. Some even question whether officials are looking the other way in the face of rising crime.

Just last week, Bob Lee, the founder of CashApp and former CTO of Square, was fatally stabbed in a neighborhood where many crypto industry players do business.

Elon Musk immediately rebuked San Francisco’s mayor and police department on Twitter for their handling of the city’s crime scene. He called the recent violence “terrible.”

Statistics on crime and cost of living

If it feels like crime is on the rise after COVID, that’s because it is. But that is not the whole story. Violent crime in San Francisco had declined before the pandemic. It went lower in 2020, but has since risen by 7.5%. According to the SFPD, violent crime includes murder, rape, robbery, assault and human trafficking.

Bob Lee’s death appears (based on the facts we have) to be a random act of violence, and it appears that such crimes are on the rise again. Data shows that homicides and assaults have reached pre-pandemic levels. Meanwhile, rape, robbery and human trafficking are down.

San Francisco has had a notoriously high cost of living for decades now. In fact, many people who work in San Francisco can’t even afford to live there. They commute. But lately, some workers have left the city for other reasons.

“Especially in recent years, those who live outside of San Francisco have probably done so out of preference rather than affordability,” Zac Clark, founder and CEO of the nonprofit HomeMore Project, told BeInCrypto. “It’s a unique economic model where so much of our revenue comes from tourists and people who temporarily live in San Francisco to work,” he added.

Crime not covered by the neighborhood

San Francisco is a relatively small city. It extends over an area of ​​46 square kilometers. Anyone who has walked their streets knows how quickly one neighborhood transforms into another. “In a city as small as San Francisco, there is tremendous overlap in the ‘crime-ridden’ areas and areas where crime may not be as prevalent,” Clark said. “However, because of this proximity, this hypothetical overlap occurs more often than anywhere else.”

Naturally, police presence may increase in high-crime neighborhoods. Unfortunately, that won’t necessarily stop attacks from happening in adjacent areas.

“Bob Lee was stabbed in an area some of the world’s largest companies call home,” Clark said. “If it can happen there to him, it can happen to anybody.”

San Francisco and Tech

Since the Industrial Revolution, people have moved to cities in hopes of creating a better life for themselves. If the promise of success comes with a good chance of injury, people may rethink where they go. Furthermore, no company wants their success story to be surrounded by gloomy headlines. But crime isn’t the only reason ambitious companies might want to avoid San Francisco.

Back in 2018, voters passed Proposition C. The new policy taxes the wealthiest corporations in the city and uses those funds for homeless services. Although well-intentioned, the effects leave something to be desired.

At the time, Jack Dorsey was open about how the tax did not take into account differences between businesses. He wrote on Twitter that the tax would disproportionately affect fintech startups. “The tax will grow by several times our adjusted income, which no company can sustain,” he added.

But according to the San Francisco Chronicle, the city has spent only a quarter of the funds raised by 2022. Clark started his nonprofit in the wake of the pandemic, two years after the city passed Prop C. The problem clearly persists. . And the only effect of the tax appears to be undue hardship on business.

The future of innovation in San Francisco

“San Francisco has continually damaged its reputation over the years, from tech and crypto leaders to the mom-and-pop store that serves homemade food on the street corner,” Clark said.

The future of San Francisco’s tech and crypto industry is uncertain until it can tackle the crime crisis head-on. “It will take some time for San Francisco to come back from this period of decline,” Clark concluded. “I’ve been saying for years that if San Francisco fixes a few things, it will be the greatest city in the world,” he added.

Until then, technology companies and their customers must remain vigilant and aware of the dangers in this once vibrant technology hub.