no overrarching formal authority that is going to prevent Libertopia
You'd still have to fight for it just to start. Going to Somalia would have you competing against the people already there, and anyone else that wants to barge in. Plus some people would like to do this without taking someone's current country away from them. (Not that Somalia would be a big loss, but still.)
Also, I think people are misinterpreting what they're trying to do. This isn't to make "Libertopia". (Though it sounds like they certainly wouldn't mind that.) They want to enable *experiments* with government. If you want experiments, you want a plan that allows for multiple running at once, without having to wreak havoc on people that don't want to be your test dummies.
Although, I admit that a society with "99%" of it's laws and courts removed, no law enforcement agencies, no paid defense, no tax collection, no regulatory bodies, no government facilities, etc. looks strangely similar to anarchy to me. I get these ideas from the post I replied to elsewhere.
People disagree on what, exactly, libertarianism is. A few *very* different visions get lumped together. (I guess we need to start using more specific terms...) To me, the libertarian philosophy means that everyone gets the right to do whatever they want, so long as they don't interfere with others. My idea of a libertarian government would be one that seeks to prevent people from violating each others' rights, and that's it.
Some things that I think help prevent others from violating rights:
police (especially detectives)
tax collection (since the rest of it isn't coming for free)
In my version of a libertarian society, smoking in public wouldn't be allowed, because that causes harm/risk to people that didn't consent to that risk. Others think that it means being able to do whatever drug they want, anywhere they want. While I think those people have serious problems, to me, it ultimately comes down to being able to make choices, including choosing what system of law you're in.
In my "ideal" world, it would be easier to move to another place in order to live under more favorable laws. Being able to move more easily is especially important for experimental governments. *If* anything is going to work for that, modular floating buildings might be what makes it work.
The point is, people have different ideas on how things might be made better, but often there are effects that aren't foreseen. What do we do? Try them on an existing country, making people be part of an experiment when some/many of them think it's crazy? Ignore these ideas, missing out on what might have been a major advancement?
Island building has problems, too, but they're only imposed upon whoever *decides* to risk it.
I don't have anything to do with the Seasteading Institute, but if you want to understand them, read their FAQs: