During his election campaign, Donald Trump wooed millions of voters across the country with the promise of building a huge wall on the American border with Mexico. He pledged to make Mexico pay for the wall, but Andrés Manuel López Obrador – the president of Mexico – laughed at Trump’s idea and refused to pay for it. This has caused many Americans to search for a source of funding, and one congressman thinks he has cracked it.
Say Hello to Wall-Coin
Congressman Warren Davidson has clearly been paying attention to the popularity of ICOs and how they can raise large sums of money in a very short space of time. Davidson suggested that Trump creates Wall-Coin to crowdfund the building of the wall, allowing motivated individuals and companies to buy the coin in order to facilitate the building on the wall. However, in his interview with NPR, Davidson clearly doesn’t fully understand the implications of hosting an ICO – or the difference between an ICO and crowdfunding.
An ICO Is Not Crowdfunding
To an outsider, an ICO might look and feel very much like crowdfunding, but it’s fundamentally different. An ICO gives investors a chance to buy utility tokens at a discount, meaning it’s cheaper to interact with and use the blockchain solution once it goes live. Think of it like an early bird menu at a restaurant. It’s the same food you get after 7pm, but it costs less as you were there early.
Possible Room for an STO
Davidson could have inspired a new line of thinking with his comments. While an ICO is laughable for this project, an STO could be more feasible. An STO is a stock token offering and is the crypto version of an IPO – just without all the rules and regulations a traditional IPO would have. People would then invest in the wall’s construction and their ownership of the wall would be denominated in Wall-Coins – which they could then transfer and trade with others who want to own a slice of the Great Wall of America.
The SEC is Paying Close Attention
If Davidson and Trump team up and decide to use crowdfunding – or its crypto equivalent – the US Securities and Exchange Commission (SEC) will be paying very close attention. It’s currently clamping down on ICOs that are scams and nobody is safe – it’s even targeting ICO promoters. Should Trump and Davidson issue an ICO to build the wall, there is a good chance they could end up in the same boat as Floyd Mayweather and DJ Khaled for promoting a scam ICO.
Unless Wall-Coin gives holders the ability to pay for their crossing through, over or under the wall, the SEC could well deem it a scam ICO, just as it has done with so many projects before Wall-Coin.
For now, Davidson’s comments look like conjecture and a simple idea thrown into the melting pot. He could be onto something though, he just needs to dig deeper and do some more research on the topic. The wall might be controversial topic in the United States, but so too is crypto – could this be a match made in heaven?