Miami Mayor working with MiamiCoin operator on 'glitches'

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DAVOS, Switzerland, May 23 (Reuters) - Miami's mayor Francis Suarez says he is working with the operator of the U.S. city's digital currency to resolve glitches after it crashed in value this month.

MiamiCoin was billed as a possible way to boost the city's revenue and reduce taxes, while helping to put Miami on the map among technology entrepreneurs during a cryptocurrency boom.

But when cryptocurrencies shed some $800 million in value in total earlier this month, leaving the eighth-largest coin Luna virtually worthless, MiamiCoin was also hit. Suarez said that Miami has $15 million in its digital wallet, and used $5 million to help stabilize soaring rents.

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CityCoins, which makes MiamiCoin as well as coins for New York City and Austin, Texas, did not immediately respond to an emailed request for comment on what action it was taking.

Suarez told Reuters on the sidelines of the World Economic Forum (WEF) in Davos on Monday that with 3.65 billion MiamiCoins issued, its so-called tokenomics were initially "way too inflationary".

"I'm going to see if they (CityCoins) can fix the glitches they have," Suarez said, adding: "They're in the process of trying to rebalance it."

Blockchain and cryptocurrency firms have a large presence on the main promenade in Davos, but they make up a small part of the official event, geared to the financial elite. read more

Cryptocurrencies are a "technology that goes through iterations", Suarez said, adding: "The initial one was successful followed by some speedbumps".

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Reporting by Jessica DiNapoli in Davos; Editing by Alexander Smith

Our Standards: The Thomson Reuters Trust Principles.

Thomson Reuters

New York-based reporter covering U.S. consumer products spanning from paper towels to packaged food, the companies that make them and how they're responding to the economy. Previously reported on corporate boards and distressed companies.