The City of Austin gets ready to become America’s next crypto hot spot by passing two resolutions that are focused on crypto and blockchain innovation. Innovative cities throughout the United States are rushing to become the next hot spots for crypto and blockchain adoption.
Miami was the first city to adopt its part of CityCoins in 2021, enabling it to implement its crypto known as ‘MiamiCoin’ to be used for civic engagement. New York City has also made a name for itself as a crypto-friendly city by implementing educational initiatives and with Mayor Eric Adams receiving his paycheck in Bitcoin in January 2022.
Austin Takes A Major Stance
Recently, Austin – the state capital of Texas goes by the slogan ‘Keep Austin Weird’ – has taken a major interest in crypto and blockchain technology. While Texas’ desire to lead the way for crypto innovation was established one year ago when Governor Greg Abbot tweeted that he is a “crypto law proposal supporter,” Austin City has taken extra measures to guarantee the acceptance of crypto payments for the city services.
Count me in as a crypto law proposal supporter.
It is increasingly being used for transactions and is beginning to go mainstream as an investment. (Fidelity, etc. trying to get Bitcoin ETF).
Texas should lead on this like we did with a gold depository. https://t.co/1z25mtgnmu
— Greg Abbott (@GregAbbott_TX) March 29, 2021
On March 9, 2022, Austin city council member Mackenzie Kelly put forward a resolution to direct the Austin city manager to explore any possible use cases of crypto to benefit Austin together with its residents. This resolution particularly urges the city manager to examine how the city could adopt Bitcoin and other cryptos for financial transactions.
Kelly said that her resolution directs the city manager to do a fact-finding study to determine what would be needed for the city to accept Bitcoin and other crypto payments for city services:
“This is more of a feasibility study. We currently don’t have enough information as council members to know if we can accept crypto as payment for city services. We need to know more about this before we can decide. In doing so, there is security information we need to look at to see if this is even viable or if we can keep crypto on our books financially. We don’t know if we can bill it as an asset — that would prevent us from being able to accept crypto as payment. There’s also the financial stability of crypto as a whole, and if we can even accept it in that regard.”
Though some questions remain, Kelly said that Austin has always been a forward-thinking and innovative city, stating that a majority of crypto investors now live and work in Austin. Kelly also stated that Austin Mayor Steve Adler is a co-sponsor of her resolution. Given that support, Kelly thinks crypto payments will act as a useful alternative to enable people to have the flexibility of paying for various city services. She explained:
“If someone gets a speeding ticket, for example, and doesn’t have a bank account but has cryptocurrency, they could use crypto as payment. Or, if they wanted to pay their taxes or electric bills using Bitcoin or dedicate a park in their name using crypto. This is all part of the analysis for allowing the city of Austin to accept crypto payments.”
This may certainly make a major impact, as recent data from Finder.com discovered that 8% of Texans already have Bitcoin and that adoption in the state might reach 14% by the end of this year. In general, Austin might benefit from crypto payments for city services, as Google data indicates that Austin ranks as the number one city in Texas that searches for the keywords “Bitcoin” and “crypto.”
With all things considered, it should not come as any surprise that Kelly’s resolution was approved during Austin’s city council meeting that happened on March 24. Since the resolution has passed, Kelly stated that the next step for the approval will happen in mid-June when the Austin City Manager can determine whether crypto can be accepted as a form of payment.
That will be based on the city’s research about financial stability, equity, security, inclusion and consumer risks or benefits. Apart from Kelly’s resolution, Adler’s resolution that focuses on blockchain technology was also passed during the Austin March 24 working session.
In that meeting, city council member Sabino Renteria stated that Austin began exploring the use of blockchain some four years ago to guarantee that the city’s homeless people would have control of their records always. He remarked:
“The concept was what if we use blockchain technology to be able to give folks ownership and access to all of their records. I am excited at the prospect of what blockchain can do.”
While both of these resolutions are innovative, some of the Austin City council members expressed worries during the meeting. In the same context, council member Leslie Pool mentioned that her largest concern about blockchain implementation is its “lack of a central authority.” She highlighted:
“It may be tamper-evident and tamper-resistant, but that is all that it is. It’s a digital ledger. So there may be some unique uses for this or for the city to promote its use, but at this point, given its relatively recent entry into data storage or other digital arenas, I’m cautious relating to the city diving into adopting or using it. I very much want to hear from our financial office staff or experts on these technologies before taking decisions to adopt these items.”
While commenting about the crypto resolution put forth, council member Pool stated:
“I continue to believe crypto is too volatile, a form of currency to risk taxpayer dollars or employee retirements. Crypto is unregulated. It’s not just unregulated. It’s also unprotected. There’s an element for me of gaming involved here. That leaves me uneasy. Crypto as a form of payment or investment is inconsistent with the role of a municipality in safeguarding the community’s revenue.”
Austin Moves Forward Despite Worries
These worries aside, Austin residents are still positive about crypto and blockchain innovation within the city. For instance, the chair of the education committee at ATX DAO, Jesse Paterson, said that the organization strives to serve as a local resource that will enable educate city council members and residents on the impacts of the recently passed resolutions. ATX DAO is a chain-agnostic decentralized autonomous organization (DAO) based in Austin.
“Some ATX DAO members were at city hall showing our support for the resolutions, yet we still lent some caution because we are still in the early days of crypto. Therefore, it takes time to understand the space before diving into projects.”
ATX DAO is glad to offer support to any city projects or investigations into the web3 space. pic.twitter.com/8zzIEQVyNz
— ATX DAO (@ATXDAO) March 24, 2022
ATX DAO community manager and a long-time resident of Austin, Ryan Harvey, said that according to the wording of both Mayor Adler’s blockchain resolution and council member Kelly’s crypto resolution, it is clear that these are still some fact-finding missions. Nonetheless, he said that this is a positive step in the right direction:
“New information is always a good thing. But, even beyond fact-finding, both resolutions show that Austin is open for business and encourages innovation, which is fantastic.”
In the March 24 council meeting, Harvey took several minutes to share his opinion and thoughts with the council members. He said:
“There are organizations here in town like ATX DAO — and I was excited to see DAOs mentioned in the resolution — that can be a point of reference.”
Apart from the efforts being made by ATX DAO, the other Austinites are developing initiatives with Web3 and crypto elements to give back to the community. For example, City Magic is a project that aims to bring communities in Austin together via grants in the form of nonfungible tokens (NFTs).
Raffi Sapire, City Magic founder said that the project awards $1,000 grants to the people in the Austin community who want to develop a friendly space or event for the neighbors or for civic engagement.
“City Magic is for civically-minded people and for those who care about the community. It also helps build a bridge for people who may not have interacted with tokens before. Grants are NFTs, and the cost to join our committee is equal to one grant that will benefit civic engagement.”
Recently, Adler showed his support for Sapire and many other blockchain-focused Austin entrepreneurs and businesses in a tweet that read:
“Austin is excited to support the businesses and innovations that will turn the promises of Web3, cryptocurrency, and blockchain technology into reality.”
Furthermore, Austin might soon join the ranks of Miami and New York City by implementing its CityCoin. One CityCoin community member talked about how this might happen in a presentation conducted at ETH Austin, a 2-day long event that happened during South By Southwest.
The community member said that CityCoin’s primary goal is to work with the city of Austin to enable officials like Mayor Adler and council member Kelly to understand how the city’s crypto can be successful:
“We need to define this and make sure we do it right before we go about anything. Ideally, we’d like to have an announcement on this during Consensus 2022, set to happen on June 9.”
When asked about a CityCoin being implemented in Austin, Kelly said:
“I’m open to the idea, but my financial conclusion of that depends on my resolution passing and knowing that it’s feasible for the city of Austin to accept crypto as a whole.”