BERKELEY, Calif. (KGO) -- Bitcoin could have a new competitor one day, if officials in Berkeley get their way. A city councilman is proposing the city come up with its own cryptocurrency to help fund municipal projects and he's got some powerful support.
Say a city needs to pay for road construction or buy a new fire truck for its aging fleet. Often, that city will issue bonds to pay for it.
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But Berkeley City Councilman Ben Bartlett is proposing the city issue its own cryptocurrency, like a municipal version of Bitcoin.
"It's faster, it's cheaper, it's more flexible," Bartlett said. "It's a mechanism to finance whatever the community wants."
Unlike traditional cryptocurrencies, the Berkeley currency wouldn't be a big moneymaker for investors. Instead, the payoff would be knowing that the community is better off with a new grove of trees, or new equipment to beautify the city and make it safer.
It would also be a lot cheaper.
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"Traditionally, it costs $5,000 to enter the bond market. This is $25," Bartlett said.
Financial journalist Laura Shin, who hosts a podcast on cryptocurrency, says this seems like an amalgam of crypto and crowd funding.
"They would either want to do it to support the city or use these Berkeley coins, or whatever they are going to call them, to buy things," said financial journalist Laura Shin. "So most likely, people aren't going to buy them for massive returns. It would be much more similar to buying a municipal bond."
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UC Berkeley's Blockchain lab and Bay Area company Neighborly, which helps broker bond sales for small investors, are consulting with Berkeley on the project and a full roll-out of the idea is set for May.
But there's one other factor Bartlett wants people to consider.
"Ultimately, it's more fun," he said. "It's community building at its best."
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Berkeley considering its own cryptocurrency to fund municipal projects