Blockchain

MiamiCoin has now raised $24.7M…but who will benefit?

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Recently, Cointelegraph Talk to Miami Mayor Francis Suarez after the announcement Miami Residents With Digital Wallets Can Earn Bitcoin Bonuses.

The company building the infrastructure to put bitcoin dividends in the hands of citizens is CityCoins, an open-source protocol that provides a fundraising mechanism for cities.

Miami and New York City are the two first cities to start fundraising through MiamiCoin and NYCCoin r. However, neither Miami nor New York City actually own MiamiCoin (MIA) or NYCCoin, instead their treasury wallets are filled with Stacks (STX).

MiamiCoin has raised $24.7 million worth of STX, while NYCCoin has raised $30.8 million to be held in its city vault, according to a presentation by CityCoins community leader Andre Serrano at the 2022 North American Bitcoin Conference in Miami.

In order for residents to get CityCoins, they must first buy STX on exchanges like Okcoin or Binance. On Tuesday, Coinbase had planned to list STX for trading, but delayed the launch until further notice.

related: Stacks Ecosystem Becomes #1 Web3 Project on Bitcoin

Stacks is a blockchain designed to make Bitcoin (BTC) programmable. CityCoins are fungible tokens built on the Stacks blockchain, with one CityCoins token contract deployed per city. Serrano said:

“By coordinating incentives between local governments and city residents, CityCoins has the potential to change the way people interact with cities.”

He added that if MiamiCoin is successful, CityCoins could “unlock the city’s cultural value while providing new opportunities for creators,” comparing the way Los Angeles is known as Hollywood, and Miami’s potential to be known as America’s cryptocurrency capital.

At a high level, it is community mining that creates CityCoins. Mining CityCoins is performed by forwarding STX tokens to a smart contract in a given Stacks block. Miners will then be rewarded with new CityCoins tokens. Unlike Bitcoin, CityCoins have no hard cap.

According to Serrano, CityCoins offer cities a business model by incentivizing their citizens to earn passive income: 30% of mining rewards are sent to the city’s custodial reserve wallet, while 70% of mining rewards are distributed to those who choose to stake them city ​​coins.

He explained that the more valuable MiamiCoin becomes, the more willing miners are to mine it, which increases the number of STX blocks they are willing to contribute. As a rather indirect result, funds in the treasury grow, and since Stacks generate Bitcoin, the proceeds of MiamiCoin mining can be distributed to coin holders as dividends.

related: Re-elect Miami mayor to account for 401K retirement savings in Bitcoin

CityCoins are programmable, which means that smart contracts can be developed around CityCoins tokens. Serrano offers some real-world use cases, including offering residents discounts for using public transportation or shopping locally, and even paying for NFTs. Tokens may also be used to create local registries and property deeds.

How the funds will be distributed in Miami has yet to be determined. Serrano suggested, however, that the city’s top priority is to improve the public education system. Once the city decides to claim STX and convert it into U.S. dollars to fund public projects, then residents may start receiving BTC dividends.

To get public feedback on how Miami should use their funds, MiamiCoin hosts an app called MiamiVoice that allows residents to submit ideas and vote on them.