Marshall Islands Plans ICO For Sovereign Cryptocurrencybr>
The Republic of the Marshall Islands is planning to issue its own cryptocurrency as an official legal tender, to be known as the Sovereign (SOV).
Marshall Islands is a country located near the equator in the Pacific Ocean, slightly west of the International Date Line. Geographically, the country is part of the larger island group of Micronesia. The country’s population of 53,158 people is spread out over 29 coral atolls, comprising 1,156 individual islands and islets. The country is best known internationally as a former test site for nuclear weapons.
Marshall Islands legislators passed the Declaration and Issuance of the Sovereign Currency Act 2018 on February 26. The purpose of the bill is to declare and issue a cryptocurrency based on blockchain technology as legal tender of the country. The currency will be issued by the country’s Ministry of Finance and will be introduced via an initial coin offering (ICO).
“This is a historic moment for our people, finally issuing and using our own currency, alongside the USD,” said Marshall Islands President Hilda C. Heine. “It is another step of manifesting our national liberty. Allocating SOV units directly to the citizens will circulate the currency and distribute wealth efficiently to our people.”
David Paul, minister-in-assistance to the president, said the national cryptocurrency is expected to be issued later this year. The Marshall Islands government will arrange an ICO and exchanges will be allowed to apply to trade the currency.
“The move is seen as a way to bolster local budgets,” said Paul. “This was specifically targeted for the long-term needs of the country. A portion of the funds raised in the ICO offering will also be used to finance health care to islanders still affected by US nuclear weapons testing in the area decades ago.”
Paul said that the country has capped the SOV supply at 24 million tokens in order to prevent inflation. The 24 million tokens represent the Marshall Islands’ 24 municipalities, he added.
Israeli startup Neema will develop the underlying technology of the new cryptocurrency using a public protocol called “Yokwe,” which is designed to mitigate know-your-customer (KYC) and financial crime concerns by linking accounts to real, government-verified identities.
“We all dreamt of this day, when the first country goes crypto,” Barak Ben-Ezer, CEO and founder of Neema. “Once we achieve success, the SOV will bring us several steps closer to a free, more liberated world. In which money flows peer to peer, instantly and cost effectively, and no ruler can arbitrarily print more of it.
Venezuela recently launched an oil-backed cryptocurrency called Petro, claiming that it was the world’s first sovereign cryptocurrency. A Marshall Islands press release emphasized, however, that the SOV is different from the Petro because Marshall Islands is a “close ally of the US,” and the cryptocurrency’s price will be determined by the market while the Petro’s price is pegged to oil.