After having decided, like his counterpart in New York, Eric Leroy Adams, to have his salary paid in Bitcoin, the mayor of Miami Francisco Suarez, a great admirer of cryptocurrencies, had also launched last August the new digital currency of the city MiamiCoin, which at the moment, however, seems to have lost most of its value.
Check out this 🧵👇on the first CityCoin being of course MiamiCoin!!!!!!!!! https://t.co/YMUjRwUES1
— Mayor Francis Suarez (@FrancisSuarez) June 2, 2021
The MiamiCoin project: the rise and fall of value
The initiative was created by the company City Coin, using the Stacks protocol, a smart contract network built on the Bitcoin (BTC) blockchain. The same company is then working on similar projects, including two other large cryptocurrency-friendly American cities, such as New York, Austin in Texas, and Philadelphia in Pennsylvania.
But the project started with high expectations, and after touching a record valuation at the end of September at 0.05 against the dollar, now after the drop in the markets, the coin would have lost 88% of its value against the American currency.
In November 2021, during an appearance on Coin Base TV, the mayor of Miami, Francisco Suarez, had enthusiastically stated that his government had earned more than $21 million with its digital currency since its debut. But from there, it’s been a succession of declines that have led to Miami’s currency losing much of its value.
Since part of the coin’s earnings went directly into the city’s coffers, some thought that this could also have beneficial effects on Miami citizens’ taxes.
“It’s possible that this could be another form of revenue for cities. The value of MiamiCoin may be so high that a city may decide to reduce taxes,”
had said the professor of the department of business analysis at the University of Florida, Pouyan Esmaeil Zadeh.
For the associate professor of information systems and business analysis at the same university, Hemang Subramanian, MiamiCoin closely resembles municipal bonds in India.
“In India, you can’t always depend on government funds for certain projects. What you do is you borrow from people who live locally, and you promise them certain services, like roads. Then you earn interest based on whatever project is undertaken.”
Miami’s investment with the MiamiCoin
A few days ago, the mayor excitedly tweeted that the city had received its first $5.25 million in MiamiCoin.
“This is a historic moment for our city to work with an innovative company that creates resources for our community through innovation rather than taxation.”
These are the mayor’s words.
This is a historic moment for our city to collaborate with an innovative project that creates resources for our city through innovation not taxation.
— Mayor Francis Suarez (@FrancisSuarez) February 2, 2022
In a later tweet then, the mayor explained that he proposed to use the money earned from the digital currency in a new assistance program for the citizens of Miami.
I’m focused on making a difference, not just a statement—and Miamians need action.
I’m proposing to my City Commission to allocate the $5m generated by MiamiCoin towards our Rental Assistance Program to immediately address increasing rental prices. pic.twitter.com/TbmIiRDYwm
— Mayor Francis Suarez (@FrancisSuarez) February 10, 2022