The Marshall Islands, a Pacific island republic nestled between Hawaii and Australia, is launching the world’s first sovereign cryptocurrency that can be used as legal tender.
Aptly called Sovereign (SOV), the digital currency was developed in partnership with Israeli startup Neema. The cryptocurrency will be the nation’s second federally recognized legal tender, on par with the US dollar.
The country’s parliament passed a law last week to approve SOV as its new currency, with President Hilda Heine commenting after the vote:
"This is a historic moment for our people, finally issuing and using our own currency, alongside the USD. It is another step of manifesting our national liberty."
The government has scheduled an initial currency offering (ICO) for later this year to distribute SOV to residents of the island. In addition to free allocation of the digital currency to locals, the state will allow the participation of global investors afterward.
The launch of the SOV is part of Heine’s much broader ‘E-Conomy vision’ which aims to establish an economy based on the extensive use of blockchain to manage the cryptocurrency, secure recorded biometric IDs, and later on the voting system, ownership, and even licensing.
“The [Republic of the Marshall Islands] will invest the revenues to support its climate change efforts, green energy, healthcare for those still affected by the US nuclear tests, and education. In addition, SOV units will be directly distributed to citizens,” Heine added
Neema CEO Barak Ben Ezer recently spoke with Cryptovest, describing the SOV as a one-of-a-kind cryptocurrency for being “legal tender” unlike Venezuela's Petro, which is not recognized as state-issued money. Ben Ezer said:
"I came up with an Idea: let’s create a crypto which is the legal tender of a sovereign nation. This way, legally, it’s real money just like USD, Euro, Yen. And this regulatory clarity on a cryptocurrency, - the SOV- represents a profound leap in mainstream adoption potential.”
As a recognized national currency, SOV can be used to repay all debts in the Marshall Islands, including private and public loans.
Cambodia mulls national crypto coin
In related developments, Cambodia is said to announce the launch of its own national cryptocurrency today (Wednesday) after the government was inspired by the Petro debut in February.
Reports have indicated that Cambodia is planning to announce Entapay during the ASEAN BlockChain Summit in the capital Phnom Penh, with Deputy Prime Minister Men Sam in attendance. However, some media reports quoted the government as officially denying any plan of creating a state-issued virtual currency.