Add a flourishing cryptocurrency economy to Miami’s growing list of qualities enticing business leaders and entrepreneurs. Technology innovators have taken notice of the city’s international scope and friendly regulatory environment for fintech (financial technology) startups.
Scott Spiegel, the Miami community lead for the Florida Blockchain Business Association, describes Miami’s fit for the emerging economy as “a global city for a global technology,” emphasizing the connection to Latin America.
“Latin Americans, like Venezuelans and Argentinians today, have had severe experiences with economic crises due to hyperinflation,” he says. “They understand the concept of a cryptocurrency as a safe store of value separate from the government or third parties more readily than the typical American because we have the privilege of being the world’s reserve currency.”
Nonetheless, the United States is not free from volatility, he points out, citing the Federal Reserve’s practice of printing money to stimulate the economy during downturns, only to cause inflation and another market bubble elsewhere, creating what he calls “boom and bust cycles.”
The Philadelphia native came to Miami for Miami Herbert’s Master of Science in Finance, following in the footsteps of his older brother, also a UM alumnus. Here, he discovered the city’s ideal characteristics for a budding cryptocurrency industry that had already captured his attention.
“Even as an undergraduate, I questioned how our economy is handled from a monetary perspective,” he says.
Learning about Bitcoin from friends, he recognized cryptocurrency, embedded in the security of blockchain technology, as a type of sound money that cannot be manipulated, making way for a freer marketplace to emerge.
“What the internet did to democratize information and allow us all to post information on social media, blockchain is going to do for financial and economic value,” he envisions. “A new financial system is being built on the internet, though it is still in its early days, much like the early days of the internet itself.”
In 2019, drawn by the potential of a new, virtual economy, Spiegel co-founded the Miami Blockchain Center, a coworking space and education center dedicated to teaching industry enthusiasts about crypto technology. The launch in June of that year included an official ribbon cutting by City of Miami Mayor Francis Suarez, who actively seeks to establish Miami as the next tech innovation hub in the country.
State legislators have also embraced the forward-thinking outlook, passing policy that facilitates tech startups throughout Florida. In January, for example, legislators implemented the Florida FinTech Sandbox, which the Florida Blockchain Business Association helped pass. The policy creates a “sandbox” of eased regulatory conditions in which businesses can experiment with innovations like cryptocurrency and blockchain without the usual, more burdensome oversight that may often pose barriers to entry.
Though the Miami Blockchain Center closed its doors a few months into the COVID-19 pandemic, the venture opened opportunities for Spiegel to co-found more recent initiatives: BitBasel, MiamiDAO, and Miami Stablecoin.
BitBasel, a series of CryptoArt events based in Wynwood, creates all the buzz for the latest in the cryptocurrency art world by hosting events and educating artists on new ways to monetize their work through the use of blockchain technology. Artists are able to tie their digital assets and intellectual property onto a blockchain through a nonfungible token (NFT), a unique encryption that renders the asset immutable as a “one of one” piece that the creators can then sell to collectors or through auctions.
BitBasel kicked off during Miami Art Week last December as a hybrid in-person and live-streamed gallery. In March, another event during Miami Music Week connected artists to musicians who likewise begin to monetize their work in this new way. The most recent event, the BitBasel NFT Gala in late April, featured educational components, auctions, free NFTs, and live performances. Spiegel expects to have events lined up to coincide with this year’s Art Basel to contrast the traditional art forms with new art mediums.
A DAO, or Decentralized Autonomous Organization, corresponds to another novel application of blockchain technology. A DAO acts like a treasury on the blockchain that members hold control over to fulfill a given organizational mission, much like regular, mission-oriented organizations, except virtual.
The MiamiDAO, to launch this summer as the first community organization that will live on the blockchain, will focus on social impact projects that affect Miami-Dade County. A proposal for tree planting in a certain section of the city, for instance, or other such local improvement projects would receive consideration by the members of the DAO, which Spiegel hopes will be residents of the county. Funds will be used to carry out the approved ideas.
“It is an experiment,” he says, noting that the project will be enacted under the Florida Fintech Sandbox. “We want the MiamiDAO, as the first-ever project of its kind, to showcase how blockchain technology can be used in a city to innovate on governance and how social impact projects can be funded for a community.”
Miami Stablecoin
The Miami Stablecoin, a community currency also to be launched in the summer and the first project to have entered the Florida Fintech Sandbox, is meant to complement the MiamiDAO. One stablecoin will always equal one dollar, offering the benefits of a cryptocurrency but without the fluctuations of an emergent exchange.
“We back it with a reserve of assets that keep it stable,” Spiegel explains, specifying that local consumers will be able to use the currency at Miami shops and restaurants. “We wanted to make a currency that can be spent at local businesses and keep the wealth inside our county and city.”
The experimental approach, not yet tried in another major city, may help support small business owners as they recover from the economic impacts of the pandemic.
Beyond these initiatives, the crypto-tech trailblazer sees university participation as an essential driver for continued industry growth. He currently collaborates with Miami Herbert Vice Dean Henrik Cronqvist in developing a blockchain “bootcamp” introductory course.
His advice for students that may have already identified a calling in cryptocurrency? You are not too late.
“There is a huge demand for talent in this industry,” he says. “Many companies are looking to hire. Many businesses are being started or are yet to be started. It’s unchartered territory.”
