Miami Mayor aims to turn the city into a bitcoin hub.
Bitcoin has had a few good months. Since around October, its price has kept going up and up. In the last quarter, it has shown a growth of more than 300%. According to most analysts, this rally is mainly due to institutional investors.
Big financial companies have announced their support (and acquisitions) of Bitcoin and that has made the coin trustworthy for smaller investors. This year alone, the various comments of Elon Musk have driven the price of BTC up (and also the price of DOGE, a usual hobby of Elon).
But apart from his tweets, he also announced that his company Tesla invested $1,5 billion of its cash holdings in bitcoin to “maximize returns”. Tesla also claimed it might start accepting BTC as payments.
Similar news shows up on the east coast. The Miami Mayor, Francis Suarez, has put his name in the crypto space with a series of interviews and public announcements in the last months.
The latest headlines talk about his plans to make Miami the “new Silicon Valley” and a crypto hub in the United States.
Suarez v. the Miami commissioners
Suarez asked the city commission to approve a law to pay public workers a part or all of their salary in BTC. He also wants to allow residents to pay their taxes in bitcoin.
According to the Mayor:
“We’re on the cusp of seeing a major titanic shift on this. It’s an industry that’s boisterous, vociferous and growing, and this would send the right signal”.
And this whole sending signal stuff is what’s making Suarez popular among bitcoiners. Not just companies’ CEOs but also many crypto advocates on social networks have expressed their desire to move to Miami. Some say the only thing missing in the city is a tax-free environment for crypto transactions.
City commissioners, however, aren’t that enthusiastic about Bitcoin. One of them, Manolo Reyes, advised Suarez to be cautious and asked to analyze the proposal very well first
This response was later agreed by the commission, with 4 out of 5 commissioners voting to keep further analyzing the use of Bitcoin. Still, Suarez is positive about the outcome and even posted a video on its Twitter page stating:
“It’s wonderful to be a very ‘crypto-forward’ city in the city of Miami, and I want to thank my commission colleagues for allowing that to happen”.
For now, the city will start informative campaigns about cryptocurrencies. They will also push for the Florida Legislature to allow public funds to be held in bitcoin.
Miami loves bitcoin
In recent weeks, Suarez also published an interview with the Winklevoss twins on Twitter. There, they discussed the possibility of opening a Gemini headquarter in Miami, aimed at Latin American clients.
Gemini, the exchange of the twins, would be one of the many techs and crypto companies to move to this city during Suarez’s term.
Regarding all this news, Tyler Winklevoss claimed:
“This is what leadership and vision look like. Miami under Mayor Francis Suarez is quickly becoming a major global bitcoin, crypto and startup hub”.
Suarez also stated that he wants to invest 1% of Mami treasury in BTC, but this has been argued against due to the volatility of the coin. There are some laws that might advise against it as well, but the Mayor is definitely focused on taking crypto to every Miami corner (and shore).
This approach can be very positive if you think about the number of tourists Miami gets on a regular weekend (if there’s no COVID-19 around of course). With a liquid bitcoin market in most stores and services, customers from every country could pay for goods while saving up the exchange costs. They wouldn’t have to convert their national currency to dollars.
The ball, for now, is on the commissioners and Legislature side.
“It’s the messaging that matters”
Suarez said that his attempts are about sending the right signal. On a similar note Mike Novogratz, founder and CEO of the crypto investment firm Galaxy Digital, said in an interview with Bloomberg that “it’s the messaging that matters”.
Novogratz talks not only about Miami. He also refers to Tesla and its recent investments.
“It doesn’t have to be a lot. It’s the messaging that matters. You’re seeing the herd here, and it’s coming. You’re going to see every company in America do the same thing”.
Miami is not alone
Suarez is not the only politician in the USA to embrace bitcoin as the main goal. Andrew Yang, candidate for New York Mayor said he also wants to turn this city into a major Bitcoin hub.
New York, at the moment, is one of the hardest places for crypto startups in America, due to its tight regulations. In 2015, New York authorities approved the BitLicense proposal. They then asked crypto companies to apply for it, or else they couldn’t keep operating there.
While some applied and were granted permission, most of the companies fled out and moved to other cities, hindering the New York cryptocurrencies market. As of now, NY residents can only purchase bitcoin on Coinbase or Gemini.
Yang is expected to ease the process and Cynthia Lummis, a Wyoming Senator, even urged him to “unravel” the BitLicense. If he wants to compete with Miami, that is the way to achieve it.
But he also should follow Suarez’s steps and integrate bitcoin into the mayoral finances. Collecting taxes in bitcoin is an idea that has already been tested in Europe, with positive outcomes.
In Switzerland, the so-called crypto valley of Zug started accepting bitcoin for tax payments last year. They also have very low taxes for crypto transactions, which have attracted a lot of big companies to move there.
We don’t know whether Miami or New York will become the next crypto valley (or crypto island or crypto shore). However, we know the benefits it can bring to their population and even to the country as a whole.