Vitalik Buterin, co-founder of Ethereum expressed his opinion on creating a crypto city and his interests in seeing cryptocurrency develop.
In a blog post published on Sunday, Ethereum (ETH) co-founder Vitalik Buterin spoke in favor of using the cryptocurrency phenomenon to serve the interests of local authorities and their citizens. In particular, Buterin discusses the formation of city tokens and decentralized autonomous organizations known as DAOs. A DAO is a self-managed organization where users create and enforce their own rules, e.g.
The idea is still in its infancy. However, Buterin argues that city tokens must fulfill at least three of the following five objectives:
- Act as a sustainable source of state revenue
- Facilitating economic cooperation between residents and cities
- Promote savings and wealth accumulation for all
- Promoting social initiatives throughout the city
- Reduce wealth inequality
Regarding the last point, Buterin suggested that most of the newly issued city tokens go to residents as a form of universal basic income. The co-founder of Ethereum criticized the current mechanics of the economy for favoring "the rich over the poor". The most famous Crypto City project described in the blog post is CityCoins, which is based on the blockchain stack (STX). The stack is a one-tier solution that enables smart contracts on the Bitcoin (BTC) network. The protocol distributes 30% of the proceeds from BTC mining, which will be passed on to STX owners in the portfolio provided for each city.
Theoretical uses include discounts and benefits provided by local businesses to CityCoin owners. The group has released one type of city token, MiamiCoin. Miami Mayor Francis Sanchez has publicly supported him, saying he could "revolutionize the way government is funded". In addition to the socio-economic impact, Buterin also praised the potential of urban tokens to improve existing governance: “Digital democracy is the 21st. And if you're using blockchain to secure voting, it seems much safer and politically feasible to start with a fantastic new kind of voting than reconfiguring an existing voting system.