Marshall Islands Utilizes Stellar for Digital Universal Basic Income
- The Republic of the Marshall Islands (RMI) distributed USDM1, a token on the Stellar network, as part of its universal basic income program.
- USDM1 functions as a fully collateralized sovereign bond that generates yield for asset holders, unlike a typical stablecoin.
- The initiative aims to digitize the economy of RMI, which currently relies heavily on physical cash due to limited banking services.
- The Stellar Development Fund (SDF) supports this project with a multi-million-dollar grant and is involved in similar projects globally.
The Marshall Islands’ adoption of USDM1 through Stellar’s blockchain represents an effort to enhance financial inclusion by providing digital assets directly to citizens’ accounts via Lomalo wallets. This shift addresses challenges posed by the country’s reliance on physical cash and limited banking infrastructure.
With USDM1 disbursements made quarterly, the initiative offers an alternative financial system that could mitigate risks associated with losing correspondent banking relationships. Source
