Economics in Brief: Philadelphia Says No to CityCoin
The Bottom LineThe Bottom Line

Economics in Brief: Philadelphia Says No to CityCoin

Also, the Biden administration extends the student loan moratorium, and more physical places of business are open now than pre-pandemic  

(Photo by Ivan Radic (CC BY 2.0))

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No CityCoin in Philadelphia

The City of Philadelphia is ceasing the adoption of CityCoin, a philanthropic cryptocurrency that municipalities can use to finance local programs, Billy Penn reports.

Chief Information Officer Mark Wheeler explained to Technical.ly that the decision was based on CityCoin’s newness, as it was difficult to envision how the city could implement cryptocurrency into its funding. Also, the permissionless cryptocurrency carries the risk that owners of of PhillyCoin are untraceable and could potentially use it for illicit transactions.

Other mayors, however, do not seem too concerned. Miami Mayor Francis Suarez recently accepted over $5 million from CityCoin. Though the amount has since depreciated greatly, Miami local officials plan on using the funds to create a rental assistance program that could help build financial literacy in the community.

What exactly is CityCoin? In simple terms, CityCoin acts as the middleman between local governments and cryptocurrency, as municipalities are not yet permitted to own any crypto on their own. Instead, CityCoin provides cities with up to 30% of the income generated by the digital coin. The other 70% goes into a fund that any coin user can cash out, regardless of where they live.

“We don’t fault anyone in the city of Philadelphia for waiting until the big picture can be seen more clearly,” wrote CityCoins public relations liaison, Logan Storrer, over Discord. “PhillyCoin would be treated exactly like MiamiCoins, where ‘the city has the ability to request any funds generated from their wallet at any time’ even if they can’t directly own the wallet.”

Biden Administration Extends Student Loan Moratorium

President Joe Biden has prolonged the payment pause on federal student loans until September, CNBC reports.

Nearly 40 million Americans owe an average of more than $30,000 in loan debt. While activists are celebrating this small victory, advocates are pushing for more, as nearly 66% of likely voters are in support of forgiving student debt.

President Biden campaigned for loan forgiveness during his presidential run, promising to cancel up to $10,000 of student debt per borrower. However, influencers from the moderate and progressive sides of his party still argue over the terms. Senate Majority Leader Chuck Schumer (D-N.Y.) and Senator Elizabeth Warren (D-Mass.) are asking the president to forgive up to $50,000 but Senator Joe Manchin III (D-W.Va.) opposes broad debt cancellation.

Biden said this extension of the loan moratorium was necessary as the country is “still recovering from the pandemic and the unprecedented economic disruption it caused.” Researchers had long warned the Biden-Harris administration that restarting payments would cause a steady increase in delinquency rates.

Read more about it here.

More Physical Places of Business Open Now than Pre-Pandemic

Newest data from the Quarterly Census of Employment and Wages show that the number of total business establishments nationwide are 7% higher than pre-pandemic levels.

The Economic Innovation Group reports that the South saw the biggest growth, with small and mid-sized counties making the largest gains. However, metropolitan areas like Queens, Detroit and Baltimore saw the biggest decline.

Analysts point to the massive federal relief as the reason businesses were able to survive and even grow during the pandemic.

This article is part of The Bottom Line, a series exploring scalable solutions for problems related to affordability, inclusive economic growth and access to capital. Click here to subscribe to our Bottom Line newsletter. The Bottom Line is made possible with support from Citi.

Solcyre (Sol) Burga was an Emma Bowen Foundation Fellow with Next City for summer 2021. Burga graduated from Rutgers University with a degree in political science and journalism in May of 2022. As a Newark native and immigrant, she hopes to elevate the voices of underrepresented communities in her work.

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Tags: philadelphiastudent debtpandemic reliefcryptocurrency

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