The Republic of the Marshall Islands has just completed the world’s first on-chain disbursement of universal basic income (UBI), using a digitally native sovereign bond called USDM1 on the Stellar blockchain. Delivered as part of the government’s ENRA program, the multimillion-dollar initiative replaces quarterly physical cash deliveries to eligible citizens — many of whom live on remote, widely dispersed islands — with direct digital transfers. The effort was built in collaboration with the Stellar Development Foundation (SDF) and infrastructure provider Crossmint. USDM1 is a U.S. dollar–denominated sovereign bond that is fully collateralized by short-term U.S. Treasury bills. It is issued under New York law using a Brady-bond style structure, the Finance Ministry said, with Treasury collateral held by an independent trustee and redemption rights described as fixed, unconditional and legally enforceable. The bond is distributed via the Stellar Disbursement Platform into Lomalo, a custom digital wallet app developed by Crossmint, enabling recipients to receive funds instantly through Crossmint wallets on the Stellar network. In a statement to CoinDesk, the Finance Ministry stressed that USDM1 is a fiscal distribution tool, not a new currency: “ENRA is a fiscal distribution program, not a currency initiative,” the ministry said, adding that every unit is issued one-to-one against short-dated U.S. Treasuries held in trust and “fully backed and legally segregated at all times.” SDF CEO Denelle Dixon framed the rollout as a milestone for real-world blockchain adoption, saying the program “exemplifies what adoption looks like for blockchain technology,” by delivering everyday financial access where it was previously limited. The initiative — years in the making — was shaped by the practical realities of the islands themselves. “Distance, dispersion, and limited physical infrastructure shape the realities of daily life,” the Finance Ministry said, noting the system was purpose-built for the Marshall Islands’ unique geography. A white paper released alongside the launch lays out the broader policy and financial framework for USDM1. Beyond the immediate benefits of faster, digital payments for remote populations, the project represents an early example of sovereign finance intersecting with blockchain rails — a blueprint other countries may study as they explore digital delivery of public funds. Read more AI-generated news on: undefined/news

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