The Marshall Islands launched USDM1, a Stellar-based sovereign bond token, through the Lomalo digital wallet to disburse universal basic income to citizens. The token generates yield for holders and addresses the nation's reliance on physical cash after banking sector collapse.
The Republic of the Marshall Islands began distributing USDM1, a fully collateralized sovereign bond token built on Stellar, to citizens through Lomalo, a digital wallet developed by Crossmint. Unlike stablecoins, USDM1 generates yield for asset holders rather than issuers, functioning as a money market fund. The initiative addresses critical financial infrastructure gaps: the Marshall Islands lost banking access after 2008 and now relies on physical cash delivered via shipping containers, with citizens sometimes traveling long distances to access funds. The Stellar Development Foundation funded the project as part of broader efforts to expand financial services in underserved regions. The quarterly disbursements provide opportunities to digitize the economy while ensuring individual ownership of funds, with implications for financial autonomy among marginalized groups.
