Note: This is not financial advice. This is for educational purposes only. Please note that cryptocurrency is a highly volatile asset class; only invest what you can afford to lose.
“How to buy Miami Coin” is a search query that is exploding in popularity on Google for one reason: investors are anxious to get their hands on Magic City’s newly launched cryptocurrency. You read correctly! The bustling Florida-based city is debuting a brand-spankin’ new digital asset called “Miami Coin.”
Miami Mayor Francis Suarez says the city partnered with CityCoin, a cryptocurrency team that facilitates the launch of digital assets that support municipalities. Miami city officials are crossing their fingers that Miami Coin will help generate millions of dollars in revenue to fund local projects.
What is Miami Coin?
Miami is one of the most cryptocurrency-friendly cities in the US. In fact, the Bitcoin Conference was held in the picturesque Florida city in early June. However, Miami Coin is no Bitcoin, so it’s important to understand the risks of this city-based digital currency before investing in it.
Firstly, according to Miami Coin’s main website, 30% of the revenue generated from Miami Coin will be forwarded to a wallet reserved for the city of Miami. This concept of splitting proceeds isn’t new. SafeMoon, for example, charges a 10% fee for selling it; 5% is redistributed to existing holders and the rest is reserved for the liquidity pool (a storehouse of tokens that enables users to trade tokens).
That being said, Miami Coin was launched to benefit the financial health of Magic City, so if Miami has a special place in your heart and your intentions of purchasing Miami Coin is based on altruism, you are the target audience. However, if you have reservations about a portion of your earnings being funneled straight into Miami’s digital wallet, you may want to reconsider Miami Coin.
How to buy Miami Coin
To acquire Miami’s new cryptocurrency, you won’t be able to purchase it — at least, not yet. You’ll have to “mine” it.
“MiamiCoin is powered by Stacks, a protocol that enables smart contracts on the Bitcoin network. Anyone can compete to mine MiamiCoin by forwarding their STX tokens through the protocol,” CityCoin said.
If this is confusing to you, don’t worry; I’ll break it down for you. Mining typically involves using hardware to solve complex cryptographic equations to validate and secure a cryptocurrency network, and in return, you’ll receive digital assets as a reward. For example, you can mine Dogecoin with your PC and earn DOGE as an expression of gratitude for lending your hardware power.
However, Miami Coin is different from Dogecoin mining, which is biased toward owners with top-of-the-line hardware. “There are no hardware requirements for mining [Miami Coin],” CityCoin said. “All you need to do is transfer Stacks (STX) tokens to [Miami Coin’s] smart contract.”
So what, exactly, is Stacks? Well, unlike the Ethereum blockchain, you can’t build apps or NTFs on top of Bitcoin. But Stacks came along and changed everything; this protocol lets users build apps, smart contracts and cryptocurrencies atop the Bitcoin network. Stacks’ technology finally makes Bitcoin “programmable.”
To use the Stacks protocol, however, you’ll need to buy STX. In the same way you need to buy ETH (Ethereum’s native token) to purchase NFTs that run on the Ethereum blockchain, you’ll need to buy STX (Stacks’ native token) to acquire Miami Coin.
As mentioned, you’ll need to send your STX tokens to Miami Coin’s smart contract. CityCoin didn’t delve into specifics on how, exactly, one would go about doing this, but the company said it will offer more information in due time. What happens next is similar to participating in a raffle. After submitting your STX tokens, you’ll be competing with others to win either STX or BTC (Bitcoin) rewards. Participants with the most tokens have a better chance of winning.
“If Alice sends 10 STX to the contract and Bob sends 30 STX, then Alice and Bob have a 25% and 75% chance to win the rewards for that block, respectively,” CityCoin explained.
If you’d prefer to buy Miami coin, you’ll have to wait; City Coin is kicking off Miami Coin by allowing users to “mine” them, first. “We will update the community when $MIA becomes available on certain trusted exchanges,” CityCoin said.
As with any investment, be sure to take proper risk management before investing in highly speculative assets like Miami Coin and other cryptocurrencies.