The Republic of the Marshall Islands, an island nation and a United States associated state situated near the equator in the Pacific Ocean, has been using the US dollar as money since it gained independence as a democratic country in 1979.<\/p>\n\n\n\n
In order to keep up with the changing times, the Marshall Islands intends to launch its own sovereign digital currency, based on blockchain technology. David Paul, Minister In-Assistance to the President and Environment, Marshall Islands, wrote in an update posted on Coindesk<\/a> that the country passed the Sovereign Currency Act last year.<\/p>\n\n\n\n The Act confirms the nation\u2019s intentions to introduce a new currency, called the Marshallese sovereign (SOV). It will be used as a medium-of-exchange (MoE) along with the US dollar. Paul pointed out: <\/p>\n\n\n\n \u201cIssuing a currency is of course the prerogative of any sovereign nation, but what is unprecedented is that we have chosen to issue our sovereign currency using blockchain technology.\u201d<\/p><\/blockquote>\n\n\n\n One of the main reasons for issuing a blockchain-based currency is that it will allow the nation\u2019s money supply to be \u201cpredetermined and tamper proof,\u201d Paul noted. Another benefit of issuing a distributed ledger technology (DLT)-enabled currency is that compliance would be handled by the currency\u2019s protocol itself, while maintaining financial privacy for the nation\u2019s citizens.<\/p>\n\n\n\n Explaining why a digital currency will be useful, Paul mentioned that Marshall Islands residents are currently paying as much as 10% in transaction fees when sending or receiving money using remittance services. It\u2019s also quite difficult to acquire and install ATMs because the country is located in the middle of the Pacific Ocean, Paul noted.<\/p>\n\n\n\n However, he believes blockchain-based transactions will be significantly faster, cheaper, and simpler to execute. He also thinks DLT-based transfers are more secure, because they\u2019re replicated across a peer-to-peer (P2P), or decentralized, blockchain network. <\/p>\n\n\n\n According to Paul: <\/p>\n\n\n\n \u201cThe only infrastructure needed for a blockchain-based digital currency is the network itself. We do not need to create a central bank and manage the printing and processing of paper money.\u201d<\/p><\/blockquote>\n\n\n\n He added that the Marshall Islands government decided to put a limit on the money supply after witnessing the problems with fiat currencies which are highly unstable, because there are no restrictions on how much fiat money you can print.<\/p>\n\n\n\nBlockchain Infrastructure Is Simple to Deploy<\/h2>\n\n\n\n
Money Supply Will Grow At Sustainable 4% Each Year<\/h2>\n\n\n\n