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The ICO of Berkeley took a step closer to achieving this week, getting a meaningful vote from Approval from the local council town.
The California city was not the first locality in the United States to claim the adoption of the blockchain, but it makes up for lost time through innovation. Officials from the Berkeley City Council in Northern California voted unanimously Tuesday to have the City Manager explore the benefits of using blockchain technology and an "initial offer" (ICO) to raise funds.
There are not many firsts in a $ 3.8 trillion municipal bond market. But if they decide to go ahead, Berkeley would be the first city to use blockchain technology in public finance for the issue of ammo-bonds, as Bloomberg pointed out.
The first project on the agenda for what the city sees as a pilot program would be a $ 3 million blockchain-fueled ticket to raise money for a new fire truck, such as the $ 15 million fire truck. reported the buyer of the bonds. The debt instrument would be a way for the city to test the waters to issue bonds on a public registry. If that succeeds, affordable housing projects could be next.
Bypassing Wall Street
Berkeley's deputy mayor, Ben Bartlett, told Bloomberg that the use of the blockchain is the means by which the city bypassed Wall Street. Municipalities often turn to debt capital markets to issue debt, but Berkeley wants to have the option of issuing bonds below the $ 5,000 minimum threshold so that more investors participate. . There is also a discussion of investors receiving their interest distributions either in fiat or cryptocurrency.
Bartlett wants blockchain bonds to ease cuts between $ 10 and $ 25. Lowering the investment threshold makes them less expensive to invest and would give residents a chance to build their equity, Bartlett said.
"It's an exciting course to expand the market, and also create new asset classes and opportunities for our people to own new assets, particularly at the same time. light of what is happening with rampant poverty, "according to Bartlett in the Bond Buyer.
If members can see beyond their doubts, the issuance of bonds on the blockchain could be only the first step of an ambitious plan.
Indeed, Berkeley has a vision for symbolized affordable housing involving an ICO supported by ammunition. The liberal city has already entered into a partnership with startup of the munite-bond market Neighborly for the initiative.
By using blockchain, the issuance of bonds plus all related transactions would be recorded in the public ledger. If one turned to the blockchain, the third-party service providers that are required in the process of issuing the bonds would be reduced, which would reduce Berkeley's expenses.
But while the vote for the search of the public ledger was unanimous, some council members still had questions, and Councilor Susan Wengraf wondered if the use of the blockchain for the broadcast of Obligation of micro-ammunition could be "excessive"
Featured image from Shutterstock.
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