Cities source their funding through rates and taxes. They can also raise debt funding through issuing bonds. These are all traditional means. A well-run city has sufficient cash flows to cover its operational costs and invest in development projects that improve the lives of its residents. In theory, well-run cities will attract new residents and earn more revenue. Poorly run cities will see the opposite. There are some similarities to how a business operates.
The move to remote work has given people the opportunity to be more mobile. Money and people can leave poorly run cities far more quickly than before. The obvious example in South Africa is the migration from Johannesburg to Cape Town. Residents can voice their dissatisfaction with the management of a city via the ballot box. They can also register their displeasure by leaving. This is also known as the exit vote. What if there was a third mechanism via a virtual thumbs-up or thumbs-down on an ongoing real-time basis.
CityCoins (www.citycoins.co) is the latest crypto innovation. To quote directly from the website, “CityCoins give communities the power to improve their cities while providing crypto rewards to individual contributors and city governments alike”.
MiamiCoin is the test case. In two months of mining, MiamiCoin has accrued $7 million to the city. The mayor of Miami, Francis Suarez, is entirely on board.
Miners of MiamiCoin earn STX that are denominated in Bitcoin. MiamiCoin is a tradeable governance coin and a market mechanism to trade LONG or SHORT depending on one’s outlook for the city and how it is managed. The technicalities are beyond the scope of this article but are well documented on the MiamiCoin website.
To learn more about how CityCoins works listen to the podcast “Not Investment Advice Ep 24”.
The evolution of cryptocurrencies is toward the creation of a market for anything. I can’t help wondering when the FitnessCoin or the RunningCoin will emerge. Maybe it will be the CrossFitCoin. What if people were rewarded in crypto for being fit and healthy in proportion to their effort. It is only a matter of time.