Marshall Islands Launches Historic Blockchain-Based Universal Basic Income Initiative

The Republic of the Marshall Islands has achieved a significant milestone by executing the world’s first large-scale on-chain distribution of Universal Basic Income (UBI) through the Stellar blockchain network. In partnership with the Stellar Development Foundation (SDF) and infrastructure provider Crossmint, the government successfully deployed this groundbreaking program in December, fundamentally transforming how public assistance reaches eligible citizens scattered across the island nation.

Reimagining Financial Inclusion Through Digital Infrastructure

The initiative replaces the country’s traditional quarterly cash distributions with secure digital transfers via Lomalo, a customized digital wallet application. This transition particularly benefits Marshall Islands residents in remote locations, ensuring faster, more efficient access to their UBI allocations. The program, officially known as ENRA (the local fiscal allocation program), demonstrates how blockchain technology can bridge geographic and logistical barriers that historically hindered service delivery in island economies.

The USDM1 Framework: Stability Meets Innovation

At the heart of this system lies USDM1, a digitally native sovereign bond denominated in U.S. dollars. Each unit maintains a direct one-to-one correspondence with short-term U.S. Treasury securities, providing recipients with transparent asset backing. An independent trustee holds the collateral, guaranteeing fixed and legally enforceable redemption rights. This structure ensures that Marshall Islands beneficiaries receive payments backed by tangible, internationally recognized assets.

Preserving National Sovereignty in the Digital Age

The Marshall Islands Treasury has explicitly emphasized that this program safeguards both monetary and technological sovereignty. USDM1 operates under New York law through established legal mechanisms rather than regulatory discretion, creating a binding framework that protects the nation’s economic autonomy. The comprehensive white paper accompanying the rollout details the program’s policy architecture, demonstrating the government’s commitment to transparent, legally robust governance.

This landmark initiative positions the Marshall Islands as a pioneer in the intersection of blockchain innovation, public finance, and financial inclusion—proving that emerging technologies can strengthen rather than compromise national sovereignty.