Trump vs Berkeley: Why Is the UC Berkeley Holding the ICO?

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In the light of threats to cut the federal funding made by Donald Trump, one of US sanctuary cities, Berkeley, CA is looking for other financing sources to rely on.

At this point, the City of Berkeley is on the edge of innovation considering a turn to cryptocurrency.

Berkeley is planning to hold an ICO (initial coin offering). By selling digital “tokens” backed by municipal bonds, Berkeley officials intend to gain financial support.

It’s no secret that the city funding largely depends on University of California, Berkeley. The intention of holding an ICO is raising funds for social projects like affordable housing and support services for Berkeley homeless population.

The boldest perspective is that one-day homeless people will be able to use tokens instead of to buy goods and services within the area.

berkeley-ico-pic

Source: daodaily.news

Cryptocurrency: Key to Financial Independence?

In 2014, long before the introduction of crypto into social initiatives, several US cities would accept it as an alternative payment method.

According to CoinMap, Los Angeles (170 vendors reported) and New York (149 vendors reported) would accept BitCoins. Back in 2014, Dallas and Los Angeles got their first BitCoin ATMs installed.  

Developing a separate financial mechanism for entire city initiated by Berkeley City Council is crucial for building economic independence. Still, Berkeley is not the first city to step forward with a crypto of its own.

The city of Hull located in the northeast UK has a HullCoin programmed on top of BitCoin. Similarly to Berkeley, HullCoin is to be issued by nonprofit organizations and social institutions to fight financial exclusion and poverty.

Why Is Berkeley Resorting to Cryptocurrency?

It’s a bit different with Berkeley. The UC Berkeley Blockchain Lab started hatching the ICO strategy soon after the tax bill had signed the Republican tax plan. The latest changes in the legislation will have a negative impact on private contractors building affordable housing.

The accounting firm “Novogradac & Company” has conducted a study of the tax bill impact. Turns out, the affordable rental housing supply will drop by nearly 235,000 homes in the next decade.

Being one of the US educational meccas, Berkeley is suffering from the lack of affordable housing which leads to homelessness.

As of 2017, the number of homeless people was  1,000 which represents a 17% increase from 2015 and a 43% increase from 2009. Affordable housing is not the only reason for Berkeley to explore the opportunities of crypto independence.

In February 2017, President Trump himself threatened to pull federal funding from the University of California. The reason is violent protests on the Berkeley campus over the cancellation of a speech by Milo Yiannopoulos, the infamous conservative provocateur.

The threat is real: in the 2015-2016 school year, Berkeley got $370 million in federal research funding. Losing such a significant sum of might severely affect the flagship campus in the University of California system.

Digital Dollar: Can National Currencies Measure Up With Crypto?

While there’s so much going on with the ICO and cryptocurrency, US Government is keeping a close eye on the course of events. In January, Steven Mnuchin, the Treasury Secretary revealed the Government’s intention to convert the US currency into a digital dollar.

For now, the Government officials are only exploring the possibilities of tracking the BitCoin activities.

The prior attempts of introducing crypto as one of the supported national currencies have been rejected by several governments worldwide. Governments are seeking strict regulation to control cryptocurrencies within the global financial system.

This absolutely kills the idea of “decentralized anonymity” crypto is valued for. Despite this, Ripple started working with the banking system to decrease the transfer costs. Obviously, only time will tell if the “digital dollar” initiative is successful.    

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Trump vs Berkeley: Why Is the UC Berkeley Holding the ICO?
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Trump vs Berkeley: Why Is the UC Berkeley Holding the ICO?
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In the light of threats to cut the federal funding made by Donald Trump, one of US sanctuary cities, Berkeley, CA is looking for other financing sources to rely on.
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