In mid-2025, residents of Detroit will be able to make payments on taxes and other city fees using digital currency for the first time. They will be able to do so through a secure platform that PayPal will manage. The city leaders hope that this will help to attract and retain tech startups in Detroit. The innovative plan is part of a larger strategy to explore innovative technologies that could enhance public services and encourage economic growth.
Innovative technologies
Detroit is building a technologically friendly environment for residents and entrepreneurs. It will be the largest city in the U.S. to accept cryptocurrency for payment of city fees and taxes. At present, only Utah, Louisiana, and Colorado accept cryptocurrency for state payments. Colorado was the first state to allow residents to pay state taxes using cryptocurrency, and slowly others are starting to follow suit.
Currently, players at licensed casinos in Michigan can engage in online gambling using fiat currencies. The use of cryptocurrency when gambling in an MI online casino hasn’t been formally legalized or banned. This leaves room for potential advancements in the future.
Modernizing payment channels and processes
The Detroit Treasurer’s Office is committed to modernizing payment channels and processes. Besides the crypto payment option, there will be additional improvements to the city’s payment services. This will increase internal efficiency and improve the customer experience. Detroit residents will have more access to use crypto and to make electronic payments.
What is cryptocurrency?
Cryptocurrency is a digital currency. It uses cryptography and a decentralized network to enable secure transactions. This happens without a central authority like a government or bank. A public ledger called a blockchain records and verifies transactions across a network of computers.
Each user has a public key for sending money and a private key that allows them to access their own crypto assets. Transactions encrypted with the public key can only be decrypted using the private key. Cryptography use makes crypto difficult to counterfeit.
The increasing appeal of cryptocurrency
The use of digital currency in Detroit will come at a time when there’s increasing acceptance of cryptocurrencies in many areas. This year, top coins like Bitcoin and Ethereum performed strongly. Their appeal is increasing among investors.
Bitcoin’s recent rally has been attributed to the election of the crypto pro-President Trump. However, like any other asset, the price of bitcoin is driven by supply and demand. This has been a big contributor to the price increase.
Adoption of crypto in e-commerce
A booming e-commerce market is encouraging forward-looking brands to embrace crypto purchases. Crypto usage in e-commerce is predicted to exceed $9.8 billion in 2030. There are many reasons why embracing crypto usage is a good idea. It can support cross-border transactions and increase access to new markets. Payments are cheaper and faster as there are no third parties involved. Blockchain use makes it virtually impossible to breach or manipulate data.
Blockchain civic applications
Detroit will be one of the first U.S. cities to explore the civic applications of blockchain. The city wants blockchain innovators and entrepreneurs to pitch their ideas to Justin Onwenu. He is the first director of entrepreneurship and economic opportunity in Detroit.
The city is enthusiastic about the potential of blockchain technology to enhance transparency, data security, and the efficiency of public services. Hearing from entrepreneurs who are pioneering the exploration of blockchain in this context is inspiring. Proposals should incorporate input from stakeholders, as well as outline the costs and risks involved. Additionally, they should explain how the proposed solutions will improve city services and benefit the residents.