The Republic of the Marshall Islands (RMI) has achieved the world’s first Universal Basic Income (UBI) on-chain disbursement using a digitally 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 has 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 bonds. The bond is distributed through the Stellar disbursement platform in a custom digital wallet application called Lomalo. Developed by Crossmint, Lomalo allows recipients to receive funds instantly through Crossmint wallets on the Stellar network.
In an exclusive statement to CoinDesk, a Department of Finance spokesperson said: “USDM1 is issued under New York law using a proven Brady bond structure that has supported sovereign finance for decades. Its basis is not regulatory discretion or policy preference, but established law.”
“U.S. Treasury guarantees are 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.
Denelle Dixon, CEO of SDF, said the program illustrates “what adoption of blockchain technology looks like,” enabling everyday financial access where it was previously lacking.
The government stressed that USDM1 did 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 individually issued against short-term U.S. Treasury bonds held in trust, fully collateralized and legally segregated at all times.”
The deployment, which lasted years, was shaped by the geographic and infrastructural constraints 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 released alongside the initiative outlines the broader policy and financial framework for USDM1.
