At this moment in time, 9% of people of people worldwide own Bitcoin. Like other technologies, it will take some time for mass adoption – cryptocurrency will improve over time to become an essential component of most people’s lives. Currently, the market is in what’s known as the take-off stage, when it begins to grow substantially, with banks and cities beginning to show interest in cryptocurrencies. While focus here is on the most well-known cryptocurrency, Bitcoin, it is just one of over 13,376 variations in existence.
We are at a stage where banks are building dedicated teams to deal with cryptocurrencies, and crypto cities are on the cusp of emerging. The next predictions are that nations will begin to adopt specific digital currencies as legal tender, and crypto will become increasingly popular amongst the younger demographic.
Globally, the change is being led by the United States. Regulators, who largely ignored cryptocurrency for years as it grew from a digital curiosity to a volatile but widely embraced innovation, are now racing to address the potential risks for consumers and financial markets. This was a direct response to companies trying to profit from bringing cryptocurrency wealth into the traditional financial system through services like interest-bearing accounts and lending.
A fast-growing product known as a stablecoin is becoming the first target for tighter regulation by international agencies. Currently lightly regulated by a patchwork of state rules, stablecoins serve as a bridge between cryptocurrency markets and the traditional economy. If stablecoins are adopted as a payment option on eCommerce platforms, their value isn’t predicted to fluctuate much, so they could become a mainstream payment method.
Crypto cities around the world
In the United States’ trend of adopting stablecoins, Miami is in first place, having accepted $7M worth of gift contributions from MiamiCoin, a digital coin created by the non-profit CityCoin. Miami’s mayor wants to put a proposal forward to allow residents to be paid in Bitcoin and pay for taxes and fees in digital currency if they get permission from the county.
Nevada is following suit, where the city’s entrepreneurs are suggesting the city should be entirely run on blockchain. They aim to create self-governing “innovation zones” – politically independent areas of land governed by high-tech businesses with at least 50,000 acres of land that promise to invest $1.25bn. While the first proposal was turned down, the city continues to go in this direction to boost tourism rates.
The city of Berkeley is also considering issuing bonds on blockchain. By lowering the entry barrier for residents from bonds costing $5,000 to only $25 through blockchain technology, the city hopes to leverage its citizens to fund fire and garbage services in the short run, as well as green energy and housing in the long run.
Moving to El Salvador in Central America, we discover the first country to adopt Bitcoin as the national currency. Most citizens use it to send money home from abroad, funds that make up for ⅕ of the country’s GDP.
Countries also committed to a digital currency future are Dubai, The Bahamas, Sweden, and Nigeria, all having launched their own “central bank digital currencies” (CBDC). Eighty-one more countries are planning to follow suit, including South Korea, with the focus being in Seoul, where a new currency, S-Coin is due to launch imminently. The country’s capital plans to use its currency for public services, transportation, and paying taxes.
In Senegal, Africa, the R&B artist Akon is building a $6 billion sustainable smart city powered by their crypto-currency called the Akoin on land donated by the Senegalese government.
Other countries like China and Iran are at the other end of the spectrum when it comes to attitudes about cryptocurrencies. Both countries banned the use of cryptocurrencies this year because they were unable to control consumption. China was unable to track illegal activities using their national digital currency, and Iran could not control illegal mining, suffering from country-wide power shortages.
Last but not least, countries in Europe are joining in the digital currency adoption trend: It is now possible to pay with Bitcoin for parking tickets in two Belgian cities, and a Bitcoin ATM has been installed in London.
The future is near
It seems that for now, advocates for digital currencies are focusing on accessibility in crypto cities – by lowering the barrier for contributions, they can ensure funding for social and public projects via blockchain. This is the next step of future financing, and they all need the public’s buy-in. The only way to accomplish this is to deploy fast and secure blockchain infrastructure to enable micropayments to become the economic and behavioural lifeblood of all new cities.
