CityCoins are cryptocurrencies distributed to residents of specific cities as a form of universal basic income (UBI). The idea originated in 2021 with the launch of MiamiCoin, which gave cryptocurrency to residents of Miami. Since then, several other major US cities have launched their own CityCoins, including New York, Los Angeles, and Chicago.
By 2023, CityCoins have gained more mainstream adoption and become an established form of UBI in major metropolises. The most successful CityCoin is the New York CityCoin (NYCC), which has distributed over $100 million worth of cryptocurrency to NYC residents. Over 1 million New Yorkers have set up digital wallets to receive their monthly NYCC disbursements. The NYCC project is funded by redirecting 30% of mining rewards to a custodial fund controlled by city officials.
Other CityCoins seeing growth in 2023 include ChicagoCoin and LAToken for Los Angeles. However, some cities have struggled to gain traction. HoustonCoin folded in 2022 due to a lack of resident participation. CityCoins also face criticism over the rise in speculation, volatility, and regulatory uncertainty around cryptocurrencies. .
What is CityCoins?
CityCoins are cryptocurrencies that represent different cities. They operate on the Stacks blockchain, which is a layer built on top of Bitcoin. CityCoins use the Stacks protocol to execute smart contracts that collect cryptocurrency reserves for each city.
The idea is that CityCoins can allow cities to accumulate Bitcoin reserves that can be used for civic causes. For example, MiamiCoin has already generated over $60 million worth of Bitcoin for the city of Miami. The city plans to use these funds for causes like fighting climate change and poverty.
CityCoins also allows anyone worldwide to contribute computing power to help grow the network and earn rewards. Essentially, they operate like a loyalty program, rewarding users for helping advance the network. The more CityCoins you earn, the more your city’s reserves grow.
How did CityCoins Start?
In the last week of September 2021, Miami commissioners made history by voting to establish the first dedicated cryptocurrency wallet for a local government in the United States. This groundbreaking move was initiated by CityCoins, a nonprofit organization aiming to support local governments through cryptocurrency funding. According to Patrick Stanley, the founder of CityCoins, this development marks the beginning of a trend, as he predicts that every startup city in the US will have its own CityCoin within the next two years.
The decision to start with Miami was a strategic one, as the city proved to be the ideal location due to the open-minded approach of Mayor Francis Suarez. Mayor Suarez is known for his enthusiasm towards blockchain technology and cryptocurrencies. He has even proposed the idea of paying city workers in Bitcoin and has actively encouraged mining companies to establish themselves in Miami.
With this bold step taken by Miami, other cities are likely to follow suit, embracing the potential benefits of cryptocurrency and exploring new ways to fund local governments through innovative means. As the trend gains momentum, we can expect to see more cities adopting CityCoins as a way to harness the power of cryptocurrencies for public benefit.
More on CityCoins
These locale-based cryptocurrencies can be mined by anyone globally. To mine CityCoins, users first need to acquire the native coin of the city they want to mine. Then they use a compatible Stacks wallet and load the mining portal for that coin. Users send a small amount of Bitcoin to generate Stacks that give them mining power. The more Bitcoin is transferred over time, the greater the rewards. Mined coins are split – 30% goes to city reserves and 70% to the miner. City Coins provide a creative way for crypto enthusiasts to earn rewards while supporting civic causes.
Launching a New CityCoins
CityCoins can be created for any city through a decentralized, community-driven process. The CityCoins project provides the infrastructure, but regular users are empowered to deploy new coins.
First, the community surveys which cities should have a CityCoin next. Once a city is chosen, the mayor must endorse the coin and agree to set up a city wallet to receive funds.
Then, individuals can deploy a new CityCoin smart contract on the Stacks blockchain mainnet. You’ll need to get STX tokens, connect a Stacks wallet to the CityCoins website, and submit a transaction signaling contract activation to do this.
At least 20 people must send STX to the fresh smart contract to kickstart mining. After 24 hours, CityCoin mining officially goes live.
While the CityCoins team facilitates the framework, engaged community members truly drive launching new locale-based cryptocurrencies. The decentralized process allows anyone to create a CityCoin that financially empowers their city.
So far, the following CityCoins have launched
- MiamiCoin (MIA): Launched in August 2021 for the city of Miami. It has generated over $60 million in Bitcoin reserves so far.
- NewYorkCityCoin (NYC): Launched in November 2021 for New York City. It has generated over $20 million in reserves.
- AustinCoin (AUSTIN): Launched in February 2022 for Austin, Texas.
- PhiladelphiaCoin (PHL): Launched in February 2022 for Philadelphia.
More cities are expected to introduce their CityCoins in the future. The nonprofit CityCoins Foundation handles creating new coins through its decentralized autonomous organization (DAO).
The role of stacks for CityCoins
The mining process is also friendly to the environment, as it uses recycled proof-of-work from Bitcoin, minimizing the energy needed for miners to perform computations, Stanley said. CityCoins utilizes smart contracts on the Stacks blockchain to generate value and funds. Smart contracts are programmable agreements on a blockchain that execute when conditions are met.
Stacks is key to enabling CityCoins’ smart contract functionality. This is because Stacks is a layer built on the Bitcoin network specifically to support smart contracts. Since Bitcoin itself does not support complex scripts, Stacks extends its capabilities.
The CityCoins ecosystem relies on two core processes enabled by Stacks. First is mining, which secures the network and produces new coins. The second is stacking, which activates coins to power smart contracts.
By building on Stacks above the bedrock of the Bitcoin network, CityCoins gets security from Bitcoin and the flexibility of smart contracts. This allows it to create unique tokens and scripts to generate funds and rewards for specific cities and users. The partnership between Stacks and Bitcoin powers the CityCoins model.
Unlocking CityCoins rewards through stacking
Stacking is a key process for earning rewards with your CityCoins. It involves committing your coins to a smart contract for a set period of time, similar to staking in other cryptocurrencies.
To stack CityCoins, you select the number of reward cycles you want to participate in, ranging from short to long-term. Your coins will be locked up for the duration, but you earn STX rewards at the end of each cycle proportional to your stake.
The rewarded STX can then be stacked again to unlock additional Bitcoin rewards. So stacking provides a cyclical reward system – CityCoins to STX, and STX to Bitcoin. The longer you continuously stack, the greater the potential rewards.
Stacking is available through the official CityCoins mining portals minecitycoins.com and Syvita Mining. Once your chosen stacking period ends, you can claim your STX rewards and unlocked CityCoins to stack again or hold.
Stacking creates a productive use case for holding CityCoins long-term. It transforms HODLing into an active strategy, allowing holders to unlock cryptocurrency rewards from their locale-based assets periodically.
How do CityCoins Work?
CityCoins have unique technical inner workings allowing them to generate reserves and rewards.
Here is a quick rundown of how they function:
- They run on the Stacks blockchain, an open-source network built on top of Bitcoin.
- Stacks allow intelligent contracts that power the CityCoins protocol.New CityCoins are introduced through CityCoins Foundation governance.
- Community members can submit proposals for new coins, which existing coin holders vote on.30% of the limited supply of each CityCoin is pre-mined for the city reserves. The rest is distributed through mining.
- CityCoins use a consensus algorithm called proof-of-transfer (PoX). It ties mining to Bitcoin transfers, using “stacked” SATs (tiny units of Bitcoin) to power blocks.
Miners send SATs to a smart contract address.
- Stacks are activated from the SATs and determine mining power. More stacks equals more rewards.When new blocks are minted, 30% of the reward goes to the city reserves. 70% goes to the miner.
- City reserves are held in a controlled wallet only the city government can access. They can convert CityCoins to Bitcoin and use the funds.This innovative system allows cities to benefit from crypto without investing anything.
- Meanwhile, miners are incentivized to grow the network and earn stacks of CityCoins in return.
How to mine CityCoins
Mining CityCoins is open to anyone, as it leverages the permissionless nature of blockchain networks. Here are the basics of how to mine CityCoins:
1. First, you must acquire the native CityCoin for the city you want to mine. For example, MiamiCoins to mine MiamiCoin. These can be purchased on exchanges like Okcoin.
2. Next, you must download a Stacks wallet supporting CityCoins. The Hiro Wallet and OKCoin Wallet are popular choices.
3.In your wallet, load the portal for the CityCoin you want to mine. This is where you control mining operations.
4. To begin mining, you send a small amount of Bitcoin (like 0.001 BTC) to the wallet address. This allows you to generate Stacks that give you mining power.
4. The more Bitcoin you transfer over time, the greater your mining power. More stacks lead to more blocks and rewards.
5. As you successfully mine new blocks (usually daily), you will see CityCoin rewards deposited in your wallet. 30% goes to city reserves.
6. You can sell your earned CityCoins on exchanges or hold them speculatively. Some features like NFTs may also be unlocked for holding long or short term.
The process takes a bit more technical know-how than casual cryptocurrency investing. But for motivated miners, it can be a fun way to earn crypto and support cities simultaneously. Just be sure to do your research on the CityCoin you are mining.
The pros and cons of CityCoins
CityCoins introduce some intriguing concepts that bridge cryptocurrency and civic duty. But they also have some drawbacks to consider. Here are some key pros and cons:
– Help cities generate reserves without any investment from taxpayers. MiamiCoin has already produced millions in Bitcoin for Miami.
– Rewards miners around the world for supporting and securing networks. Serves as a loyalty program.
– Utilizes Stacks of blockchain innovations like PoX and smart contracts. It could drive further crypto innovation.
– Public ledgers add transparency around city revenue and spending.
– Adds cryptocurrency utility by tying coins to locales with civic causes.
-cities have limited control over reserves. Rely on market sentiment and mining participation markets.
– Complex crypto technology like Stacks could deter mainstream industry adoption.
– Regulatory uncertainty around how city governments can use crypto funds.
– Critics argue rewards favor miners over citizens actually improving cities
– Environmental concerns around crypto mining energy usage.
– Uneven distribution if just a few large miners dominate a CityCoin.
Opinions are mixed on just how impactful CityCoins can really be for urban development. But they present an intriguing crypto experiment in bringing blockchain concepts into the public sector.
The future of CityCoins
CityCoins are still in the very early stages but have already generated substantial buzz and reserves good investment. If interest continues to grow, what could be next for these locale-based cryptocurrencies?
- More city launches – Many more major cities like Chicago, San Francisco, and Washington, DC could soon have their customizable coins.
- Use cases for reserves- Cities must develop strategic plans for using reserves for citizen-benefiting causes. Legislative action may be required in some areas.
- Partnerships with governments- City administrations must explore if and how to partner with CityCoins organizations to align priorities formally.
- Implementing governance – Coins will need processes for expansion proposals, resolving issues, oversight, and other governance matters.
- Secondary features – Additional utilitarian features like NFT rewards or redemption programs could help drive ongoing mining and holding.
- Private sector collaboration- Corporations could partner with CityCoins on events, sponsorships, or branding to drive engagement. Tourism sectors may be especially interested.
There is still much unknown about the potential impacts of CityCoins. But the growth shows enthusiasm around crypto’s intersection with public infrastructure. The cities that can strategically oversee their CityCoin may benefit most from this trend.
The controversy around the CityCoins mining model
CityCoins has sparked debate due to its unusual mining structure. Rather than the typical proof-of-work model where miners compete to solve complex math problems, CityCoins uses a lottery or raffle-like system.
Participants contribute STX tokens into a smart contract for a chance to win the mining rewards paid out in periodic jackpot cycles. This means rewards are distributed randomly rather than to those who contributed the most computing power.
Critics argue this mining approach more closely resembles gambling than typical crypto mining. Those who don’t win the mining lottery lose their STX contributions, while winners take home most of the rewards.
On the other hand, 30% of all contributed STX goes directly to city treasuries, regardless of who mines coins. Supporters see this as a creative way to generate municipal revenue.
But the lack of user utility for CityCoins besides speculation and mining has also drawn skepticism. The experimental mining structure has been lucrative for some early adopters, traders, and cities. However, sustainability and fairness concerns persist around this lottery-based distribution model.
Leveraging CityCoins for civic growth
A key aspect of CityCoins is utilizing the generated profits for community-enriching initiatives and investments. As CityCoin becomes more valuable, more mining occurs, increasing revenues for the city. Cities receive 30% of all STX spent on mining their coins.
Cities can then collaborate with citizens to direct funds into impactful programs. Options include STEM education, small business grants, environmental projects, infrastructure, arts funding, and more. The possibilities are endless.
Some cities are even exploring using CityCoins as an alternative revenue model to reduce or eliminate certain taxes. CityCoin profits can provide municipalities greater flexibility in allocating money towards programs that uplift residents.
To spur innovation, the CityCoins project offers accelerator programs and grants for developing local use cases. Teams can get support for building platforms, events, education, wallets, and anything to increase utility.
The civic aspect is key. While CityCoins incentivize participation globally, the goal is enriching the affiliated locale. The more creative a city gets with putting CityCoin profits to use, the more it benefits long-term growth and community empowerment.
CityCoins introduce a new utility for cryptocurrencies – generating reserves for public works. Their adoption so far shows intriguing potential but also raises questions about impacts. Their complex technical nature may limit mainstream use. But crypto enthusiasts will likely continue mining CityCoins to earn rewards and support civic causes. As more major cities adopt unique coins, it will be interesting to watch how city governments leverage these funds for public benefit. CityCoins provide an educational foray into blockchain economics’ relationship with the public sector.
Incentivizing greener business practices
City Coins could incentivize businesses to adopt greener practices in several ways. City Coins could provide rewards in their native token to businesses that reduce emissions, source renewable energy, or improve efficiency. Discounts on licensing/permit fees paid in the City Coin could also motivate sustainability efforts. Mining City Coins could also be restricted to green energy sources like solar, wind or hydro power, encouraging green In conclusion, City Coins represent an innovative and ambitious experiment in bridging the world of cryptocurrencies with civic infrastructure. The concept of distributing cryptocurrencies to residents as a form of universal basic income (UBI) has gained momentum, with several major cities already launching their own City Coins. Operating on the Stacks blockchain, these coins have generated significant reserves for cities like Miami and New York, enabling them to fund various civic causes.
While City Coins have shown promise in generating revenue for cities and rewarding miners, they are not without controversy. The unique mining model, resembling a lottery, has drawn criticism for its potential gambling-like nature and uneven distribution of rewards. Additionally, the complexity of blockchain technology and regulatory uncertainties pose challenges to mainstream adoption.
Despite these challenges, City Coins have the potential to drive meaningful change in cities that strategically leverage their reserves for community-enriching initiatives. As more cities explore the adoption of their own City Coins, it will be fascinating to observe how this novel approach to cryptocurrency evolves and impacts the intersection of crypto and public sectors—mining infrastructure. City Coin foundations could also proactively fund grants, competitions, and hackathons focused on developing green tech solutions for local businesses.
Predicting CityCoin price movements
There are several metrics to analyze for reading and predicting CityCoin price movements. Monitoring adoption and demand indicators like wallet activations, transactions, and trading volumes can imply potential value increases if adoption grows. Governance changes to tokenomics, such as issuance rates, mining rewards, and staking yields, impact supply dynamics, so they should be tracked. By integrating CityCoins into areas like payments, licenses, and city applications, more utility use cases can increase use value. Regulatory news around cryptocurrencies and stablecoins also affects prices. Valuation models benchmarking relative adoption rates versus other major cryptocurrencies can also forecast potential price changes.
Integrating business and sustainability
CityCoins present opportunities for businesses to integrate sustainability initiatives. Businesses could install mining rigs and use the heat generated for heating/cooling offices to reduce energy waste. Renewable energy companies could leverage excess capacity to mine City Coins, creating an additional revenue stream. Partnerships between City Coin foundations and local businesses could collaborate on green projects. Sustainability efforts could also be funded by allocating a portion of mining rewards to eco-driven public works.
Implications for the crypto market
CityCoins have several broad implications for the cryptocurrency market. They diversify the crypto ecosystem beyond speculative trading into localized, utility-driven community tokens. CityCoins also provide a testbed for cryptocurrencies to interface with governments and legacy financial systems. Their success could encourage other organizations to launch customized community tokens. However, their adoption as formal municipal policy may also increase regulatory scrutiny around mining energy use, licensing and taxation. CityCoins showcase cryptocurrency’s evolving role in formal economies beyond just speculative activity.
‘They’ll all want’ it
CityCoins’ source code is open, so cities can create their own coins “without asking CityCoins for help,” Stanley said. But CityCoins — which has a poll running on its website to vote on which city should be next — doesn’t need permission from local governments to start a wallet for them.
“I think it’s best to have the government’s permission ahead of time, but in this model, you don’t need to get the government’s position up front,” Stanley said. “You can actually just launch and wait for them to claim their protocol contribution. That said, educating the government is incredibly important and it’s probably better to have them on board first.”
Patrick Stanley explains beginner investing tips on TikTok
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Stanley’s straightforward tips resonate with many TikTok users new to investing. His advice helps demystify the stock market and makes it approachable for beginners. With simple, actionable guidance delivered via short social videos, Stanley represents a new breed of financial influencers making investing education accessible.
CityCoins represent an innovative and ambitious experiment in bridging the world of cryptocurrencies with civic infrastructure. The concept of distributing cryptocurrencies to residents as a form of universal basic income (UBI) has gained momentum, with several major cities already launching their own City Coins. Operating on the Stacks blockchain, these coins have generated significant reserves for cities like Miami and New York, enabling them to fund various civic causes.
While CityCoins have shown promise in generating revenue for cities and rewarding miners, they are not without controversy. The unique mining model, resembling a lottery, has drawn criticism for its potential gambling-like nature and uneven distribution of rewards. Additionally, the complexity of blockchain technology and regulatory uncertainties pose challenges to mainstream adoption.
Despite these challenges, City Coins have the potential to drive meaningful change in cities that strategically leverage and invest their reserves for community-enriching initiatives. As more cities explore the adoption of their own City Coins, it will be fascinating to observe how this novel approach to cryptocurrency evolves and impacts the intersection of crypto and public sectors.
What exactly are CityCoins?
CityCoins are cryptocurrencies that are tied to specific cities around the world, like MiamiCoin for Miami and NYCCoin for New York City. They operate on the Stacks blockchain and allow anyone globally to help grow the networks and earn crypto rewards.
How are new CityCoins created?
New CityCoins can be proposed through the CityCoins Foundation governance process. Once a city is chosen, community members can deploy a new smart contract on the Stacks blockchain to launch the coin, if the city mayor agrees.
How do you mine CityCoins?
To mine CityCoins, you first need to acquire the native coin of the city you want to mine. Then you use a compatible Stacks wallet, load the mining portal, and send a small amount of bitcoin to generate Stacks that give you mining power. More bitcoin sent over time increases mining power and rewards.
What are the mining rewards like?
When new coins are mined, rewards are split - 30% of the reward goes to the reserves of the affiliated city and 70% goes to the miner. This allows miners to earn while also supporting civic causes.
Where can CityCoins be stored?
CityCoins can be stored in Stacks wallets that support them, like the Hiro Wallet and OKCoin Wallet. Coins can then be sold on exchanges like Okcoin or held speculatively if you choose.
Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.