MIAMI – As a cryptocurrency value took a major dive this week, with bitcoin and other cryptocurrencies losing value, MiamiCoina private cryptocurrency for the benefit of the city, experienced its own decline.
It fell from an all-time high of $0.06 in August to just $0.000952 late Wednesday, according to crypto exchange Coinbase.
This week’s Bitcoin crash came after a major cryptocurrency lender effectively failed and halted all withdrawals from its platform.
Miami Mayor Francis Suarez is a well-known crypto promoter and Miami has become a hub for the cryptocurrency industry. MiamiCoin, which is funded and operated by CityCoins, launched in August 2021 with the aim of getting the crypto bargains into the city’s coffers.
“A percentage of the benefit of verifying the transaction from one person to another is what goes into the city’s digital wallet,” Suarez said. “The biggest misconception is that the city put money into (MiamiCoin). We do not have. The city has just benefited from it.
This means that Miami will not lose money on MiamiCoin, despite the crash. So far, Suarez said $5 million of MiamiCoin funds have been earmarked for rent relief.
Suarez said MiamiCoin may or may not go ahead, but told him the most important thing is to telegraph to the tech ecosystem that Miami is open to pioneering innovation.
“MiamiCoin is only in its first year, it’s very young,” Suarez said. “Some will succeed, some will change the dynamic, some won’t.”
Local 10 News asked Silvinia Moschini, the founder of unicoinwhich bills itself as an “equity-backed currency,” if investing in MiamiCoin was like playing Russian roulette.
“Well, I think investing in a coin that is not asset backed is like playing Russian roulette because logic is not sustainable, just like Bitcoin which has lost value ,” Moschini said, comparing these types of cryptocurrencies to people gambling in Las Vegas. “(They know) the house always wins, so there’s a market for that. It’s not my favorite market. This is not my risk profile.
“When people invest, they need to know that they could lose it all and they need to understand that they shouldn’t bet or invest more than they are comfortable losing,” she added.
Moschini said CityCoins are part of a larger ecosystem of what she called first-generation cryptocurrencies that are collapsing amid macroeconomic uncertainty, rising interest rates and inflation. , even impacting the valuation of well-known cryptocurrencies, such as Bitcoin or Ethereum.
“A vast majority of them were based on no substantial support or no support, and that caused, when the economy tightened and investors became more cautious, this collapse that we are seeing now,” she said.
Moschini said she believes the industry’s maturation will include asset-backed cryptocurrencies that are “much more regulated and protect coin holders more consistently and transparently.”
Moschini, who praised Suarez for supporting “innovation” and “entrepreneurship”, said the future lay in “tightening up” the market.
Suarez said he believes that as the industry matures, it could open up new practical applications for crypto, like paying bills and municipal fees.
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