Marshall Islands will be the first country to have a cryptocurrency as its official national currency. They say this will allow them to collect hard cash to boost the economy.
This cryptocurrency called “Sovereign” (SOV) will have an equal status to the US Dollar as a means of payment on the island.
Contrarily to “Petro”, a cryptocurrency launched by the Venezuelan government, SOV will be recognized as a legal tender and will be officially backed by the government.
The cryptocurrency, which will be developed by Israeli company Neema, will be sold in part to international investors so that the Marshall Island’s government have extra funds to spend. It will be obligatory for investors to give their identities in order to use the digital currency.
In a press release, President Hilda Heine stated:
“This is a historic moment for our people, finally issuing and using our own currency, alongside the USD (U.S. dollar), it is another step of manifesting our national liberty.”
The Marshall Islands currently use the US Dollar as their official currency.
According to Barak Ben-Ezer, CEO of Neema, Sovereign is the beginning of a new era in cryptocurrency. He says it adresses the main problem of cryptocurrencies which is that it has never been approved or regulated by a government.