Despite having the public backing of the respective mayors of both cities, MiamiCoin (MIA) and NewYorkCityCoin (NYC) have plummeted 90% and 80% from their all-time highs.
According to data from CoinGecko, MIA price has fallen 92% from its all-time high of $0.055 on Sep 20 to stand at $0.004 at the time of writing this article. For its part, NYC value has fallen 80% from its March 3 high of $0.006 to trade at $0.0014.
Since investors have recorded losses of many other crypto assets in recent times, the demand for the MIA and NYC coins has almost completely dried up.
The trading volume for the duo in the last 24 hours has totaled just $70,190 and $45,663, respectively. By comparison, when MIA and NYC were at all-time high levels, they generated volumes of $1.6 million and $260,000 each.
The Mayor of Miami, Frances Suarez has spoken about the potential use cases of MIA on multiple occasions, most recently announcing in February that the local government had earmarked $5.25 million from its reserve purse to support a rental assistance program.
New York Mayor Eric Adams welcomed NYC with open arms in November, saying, “We’re excited to welcome you to the global home of Web3! We have the technology and innovation to help drive Our city”.
The assets were developed by the CityCoins project, a protocol based on the Stacks blockchain that aims to offer cryptocurrency fundraising avenues to local governments. like Miami and New York City, its two and only partners so far.
Despite potential regulatory gray areas, a key incentive is that CityCoins smart contracts automatically allocate 30% of all mining rewards to a escrowed reserve wallet for the partner city, while miners receive the remaining 70%.
In January of this year, the value of the Miami and New York reserve purses had reached about USD 24.7 and USD 30.8 million, respectively, according to CityCoins community leader André Serrano, suggesting that there had been a relatively strong demand from the community to mine the asset at the time.
However, while governments have benefited from the partnerships, the user/investor side appears to share in the mining rewards, and an alleged 9% annual return on BTC for “storing” (essentially staking) assets on the Stacks blockchain is not attractive enough to drive strong demand.
Michael Bloomberg, an urban tech researcher at Cornell Tech, recently suggested to Quartz that coins could even become worthless to cities if extra utility isn’t added to whet investor appetite:
“People will stop mining the coin if they can’t make money from it, and the only way to make money from it is by convincing more suckers to participate.”
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, so you should do your own research when making a decision.
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