Over the past year, the U.S. has witnessed a certain fragmentation as states and cities diverge on their belief in crypto. Politicians are opting to take salaries in crypto, and several locations have built laws encouraging crypto businesses to establish local operations.
Following the lead of New York and Miami, Philadelphia might soon get its own native coin.
Philly Joining the Crypto Bros
Earlier this month, Philadelphia Mayor Jim Kenney officially endorsed the prospect of creating a cryptocurrency to be used primarily in the city. Kinney told Statescoop - a government news site - that his office is enthusiastic about the possibility of receiving donations for a CityCoins project, hoping that a cryptocurrency could alleviate some of Philadelphia's biggest economic issues.
Mark Wheeler, chief information officer for Philadelphia and an ardent Bitcoin supporter, tweeted, "Philly is ready" to start working with CityCoins, setting in motion what could end up being a city-wide cryptocurrency project.
CityCoins operates as a software application. Built on the Stacks blockchain, it helps city governments build and launch cryptocurrencies by providing the infrastructure necessary for launch. The Stacks blockchain allows transactions to be settled on the Bitcoin network, bringing most city-owned digital assets even closer to the main cryptocurrency.
As Wheeler explained to Statescoop, Philadelphia will begin vetting CityCoint to ensure that their possible partnership with the platform complies with the applicable laws governing cryptocurrencies.
"I think we can simply say, 'This isn't Bitcoin and it's not requiring new servers to be set up and it's not requiring intensive energy use.' I think that's a valid, verifiable statement," he said in part when talking about the possible impacts that a CityCoins project could have on the environment.
A Beneficial Project For All
CityCoins is notable as the platform that Miami and New York City used when launching their cryptocurrencies. Miami and New York City - under Mayors Francis Suarez and Eric Adams - have become pioneers in the city-wide cryptocurrency space and have shown just how beneficial a crypto project can be.
In January, CityCoins said it successfully raised over $50 million for MiamiCin and NYCCoin. At a presentation on the third day of the North American Bitcoin Conference 2022 in Miami, CityCoins Community Lead Andre Serrano explained that MiamoCoin had raised $24.7 million worth of STX (the blockchain token for Stacks), while NYCCoin had raised $30 million.
For residents to buy these coins, they will first need to purchase STX from crypto exchanges. Serrano explained that CityCoins could transform how people interact with their cities by offering incentives.
Serrano also pointed out that CityCoins can improve a city's cultural value and offer new opportunities for creators. Citizens have an incentive to earn passive income, with 30 percent of mining rewards sent to the city's custodial reserve wallet while 70 percent is shared with people who choose their CityCoins.
CityCoins themselves can be mined by forwarding STX tokens into smart contracts on the Stacks blockchain. So, in a way, they can be staked.
Direct Financial Gain for The People
Cities like Miami and New York City stand to gain a lot from projects like CityCoins. But citizens must get some form of benefit. As the cities increase revenues, funds can be applied to worthwhile causes aiding cities and residents.
In November 2021, Mayor Francis Suarez said in an interview with local news that Miami will be the first U.S. city to give Bitcoin dividends to citizens. The dividends came from Miami's CityCoins revenues, proving that launching a cryptocurrency can be a great way for municipalities to make money.
As Suarez explained, the growth of the MiamiCoin project was impressive. If things continue at this rate, the mayor said revenue from MiamiCoin could eventually grow to cover all of Miami's tax needs - leading to lower taxes on people and businesses.
Benefits like these could become available to Philadelphia residents soon. But more work must be done to convince others in the country that cryptocurrencies are indeed beneficial.