The Republic of the Marshall Islands (RMI) has carried out the inaugural on-chain distribution of universal basic income (UBI) via a digitally native sovereign bond, USDM1, on the Stellar blockchain.
In collaboration with the Stellar Development Foundation (SDF) and infrastructure partner Crossmint, this multimillion-dollar initiative is part of RMI’s national UBI program, locally referred to as ENRA, as confirmed by the Finance Ministry of the Marshall Islands. This initiative replaces traditional quarterly cash deliveries with direct digital transfers to eligible citizens, many of whom reside on widely scattered islands.
USDM1 is a U.S. dollar-denominated sovereign bond, fully secured by short-term U.S. Treasury bills. It is distributed through the Stellar Disbursement Platform into a bespoke digital wallet app named Lomalo. Created by Crossmint, Lomalo allows recipients to receive funds instantly via Crossmint wallets on the Stellar network.
In an exclusive remark to CoinDesk, a spokesperson from the Finance Ministry stated, “USDM1 is issued under New York law with a proven Brady-bond structure that has supported sovereign finance for many years. Its basis is not regulatory discretion or policy preference, but established law.”
“U.S. Treasury collateral is managed by an independent trustee, beyond the control of any government or private entity, and redemption rights are fixed, unconditional, and legally enforceable,” the spokesperson added.
SDF CEO Denelle Dixon emphasized that the program illustrates “what adoption looks like for blockchain technology,” facilitating everyday financial access where it was previously unavailable.
The government reassured that USDM1 does not undermine the country’s monetary or technological sovereignty. “ENRA is a fiscal distribution program, not a currency initiative,” the spokesperson explained. “Each unit is issued one-to-one against short-dated U.S. Treasuries held in trust, completely backed and legally segregated at all times.”
The rollout, years in preparation, was influenced by the geographic and infrastructural challenges faced by the Marshall Islands. “Distance, dispersion, and limited infrastructure shape daily life here,” the spokesperson noted. “This was specifically designed for the Marshall Islands.”
A white paper accompanying the initiative details the broader policy and financial framework for USDM1.
