Recently, Cointelegraph spoke with the mayor of Miami, Francis Suárez after the announcement that Miami Residents With a Digital Wallet Can Earn a Bitcoin Dividend.
The company that establishes the infrastructure for Bitcoin dividends to reach citizens is CityCoins, an open source protocol that provides fundraising mechanisms for cities.
Miami and New York City are the two inaugural cities that will begin fundraising, through MiamiCoin and NYCCoin r. However, neither Miami nor New York City own MiamiCoin (MIA) or NYCCoin, rather their treasury wallets are filled with Stacks (STX).
According to a presentation made at the 2022 North American Bitcoin Conference in Miami, by CityCoins community leader Andre Serrano, MiamiCoin has raised $24.7 million in STX, while NYCCoin has raised $30.8 million which they are in the treasury of your city.
In order for residents to acquire CityCoins, they must first purchase STX on an exchange such as Okcoin or Binance. On Tuesday, Coinbase had planned to list STX for trading but delayed the launch until further notice.
We are delaying the launch of trading on STX as we work to enable note tag support for STX withdrawals on @Coinbase & @CoinbaseExch. You can still withdraw STX to any STX wallet address that does not require note tags. We will provide updates here and on https://t.co/NeRujHDZ4w https://t.co/bmlZBv7DAa
— Coinbase Assets (@CoinbaseAssets) January 19, 2022
Related: Stack Ecosystem Becomes #1 Web3 Project in Bitcoin
Stacks is the blockchain that seeks to make Bitcoin (BTC) programmable. CityCoins are fungible tokens created on the Stacks blockchain, and one CityCoins token contract is implemented per city. Serrano said:
"CityCoins have the potential to transform the way people interact with their cities by aligning incentives between local governments and city residents."
He added that CityCoins can “unlock the cultural value of a city while providing new opportunities for creators,” comparing the way Los Angeles is known for Hollywood, with the potential for Miami to be known as the crypto capital of the US. US if MiamiCoin is successful.
At a high level, it is the community that mines to create CityCoins. Mining of CityCoins is done by sending STX tokens to the smart contract in a given Stacks block. The miners are then rewarded with new CityCoins tokens. There is no maximum limit on CityCoins, unlike Bitcoin.
According to Serrano, CityCoins gives the city a business model by offering its citizens incentives 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 people who choose to stake. your CityCoins.
He explained that the more valuable MiamiCoin becomes, the more miners are willing 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 because Stacks produces Bitcoin, MiamiCoin mining profits can be distributed as dividends to coin holders.
Related: Miami Mayor Re-elected to Take 401k Retirement Savings Partly in Bitcoin
CityCoins are programmable, which means smart contracts can be built around CityCoins tokens. Serrano offered some real-world use cases including giving residents discounts for using public transportation or shopping locally, or even the ability to pay NFTs. The tokens could also potentially be used to create local registries and property deeds.
It has not yet been determined how the funds will be allocated in Miami. Serrano suggested, however, that a priority for the city is to improve the public education system. Once the city decides to claim and convert STX to USD to fund a public project, residents could start receiving BTC dividends.
To receive public feedback on how Miami should spend its funds, MiamiCoin hosts an app called MiamiVoice that allows residents to propose ideas and vote on them.
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