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Bartlett has formed a committee with Berkeley Mayor Jesse Arreguín, financial technology startup Neighborly, and the UC Berkeley Blockchain Lab to hatch a strategy for the ICO. Neighborly's cofounder and COO Kiran Jain said the city could launch its ICO, which it's calling an "initial community offering," by mid-May if the necessary approvals come through.

City leaders say Trump's tax reform will be punishing for Berkeley

The idea for an ICO came about after President Donald Trump signed the Republican tax bill into law at the end of December, according to Bartlett.

Conservative demonstrators rally on the steps of Sproul Hall at UC Berkeley in 2017. Noah Berger/Reuters

The new legislation makes sweeping changes to the tax code for businesses, some of which undermine incentives that encourage private contractors to buildof refusing to cooperate with federal immigration officers. Tensions between Trump and the city reached a boiling point in February 2017, when the president vowed to pull federal funding from UC Berkeley after the campus experienced violent protests over the cancellation of a speech by conservative provocateur Milo Yiannopoulos.

The City of Berkeley could lead the way for other sanctuary cities to create financial independence from the federal government, Bartlett said.

"It's actually enabling us to fulfill our duty as a government. Our duty is to provide for our people. It's a violation of that duty to allow people to sleep in the streets," Bartlett said.