The Republic of the Marshall Islands (RMI) has completed the world’s first on-chain universal basic income (UBI) disbursement using a digital native sovereign bond, USDM1, via the Stellar blockchain.
Developed in partnership with the Stellar Development Foundation (SDF) and infrastructure provider Crossmint, the multi-million dollar initiative is part of RMI’s national UBI programme, known locally as ENRA, the Marshall Islands Ministry of Finance confirmed. The program replaces quarterly physical cash deliveries with direct digital transfers to eligible citizens, many of whom live on widely dispersed islands.
USDM1 is a US dollar-denominated sovereign bond fully backed by short-term US Treasury bills. The bonus is distributed through the Stellar Disbursement Platform in a custom digital wallet application called Lomalo. Powered by Crossmint, Lomalo allows recipients to receive funds instantly via Crossmint wallets on the Stellar network.
In an exclusive statement to CoinDesk, a Ministry of Finance spokesperson said: “USDM1 is issued under New York law using a time-tested Brady bond structure that has underpinned sovereign finance for decades. Its basis is not regulatory discretion or political preference, but settled law.”
“The US Treasury guarantee is held by an independent trustee, outside the control of any government or private issuer, and redemption rights are fixed, unconditional and legally enforceable,” the spokesperson added.
SDF CEO Denelle Dixon said the program exemplifies “what the adoption of blockchain technology looks like,” enabling everyday financial access where it was previously lacking.
The government emphasized that USDM1 does not compromise the country’s monetary or technological sovereignty. “ENRA is a fiscal distribution program, not a monetary initiative,” the spokesperson said. “Each unit is issued one for one against short-term U.S. Treasury bonds held in trust, fully backed and legally segregated at all times.”
The launch, which took years to complete, was determined by the geographic and infrastructure limitations of the Marshall Islands. “Distance, dispersion and limited physical infrastructure shape the realities of daily life,” the spokesperson said. “This was built specifically for the Marshall Islands.”
A white paper published alongside the initiative outlines the broader political and financial framework for USDM1.
