How Marshall Islands Pioneered Blockchain-Based Universal Basic Income on Stellar

In a groundbreaking move, the Marshall Islands has become the first nation to successfully execute a blockchain-powered distribution of Universal Basic Income (UBI) on the Stellar blockchain. This historic deployment, reported in December 2025, represents a watershed moment in the intersection of cryptocurrency technology and fiscal policy, reshaping how governments can deliver welfare benefits to their citizens.

The Digital Native USDM1 Bond: Reimagining Sovereign Debt

At the heart of this initiative lies USDM1, a digitally native sovereign bond that fundamentally transforms how Marshall Islands distributes resources to its population. Unlike traditional government transfers, USDM1 is a dollar-denominated instrument fully collateralized by short-term U.S. Treasury securities, ensuring stability and legal enforceability under New York law.

The Marshall Islands Treasury confirmed that USDM1 is issued on established legal foundations rather than regulatory preferences, with collateral held by an independent trustee. The bond’s redemption rights are fixed, unconditional, and legally binding—a critical safeguard for beneficiaries spread across the archipelago. This design ensures that the nation’s monetary and technological sovereignty remains intact, demonstrating that innovation need not compromise regulatory compliance.

ENRA: The Universal Basic Income Revolution in Action

The program, formally known as ENRA (Ebon Rikjik Jikkin an Ilo Rejako), replaces quarterly cash distributions with seamless digital transfers via Lomalo, a customized digital wallet application. Citizens receive their UBI allocations directly through the Stellar distribution platform, a shift that dramatically reduces administrative overhead and improves financial inclusion for scattered island populations.

ENRA operates as a fiscal allocation mechanism, with each unit issued on a strict one-to-one basis backed by Treasury bonds. The Marshall Islands Treasury’s emphasis on legal segregation and full collateralization demonstrates that blockchain-based welfare systems can achieve the same rigor as traditional finance.

A Global Blueprint for Universal Basic Income Programs

This landmark initiative, developed through collaboration with the Stellar Development Foundation and infrastructure provider Crossmint, signals the potential for blockchain technology to revolutionize public finance distribution. The accompanying white paper outlines the broader policy framework, offering a replicable model for other nations exploring how to modernize Universal Basic Income delivery.

Marshall Islands has proven that leveraging distributed ledger technology need not require abandoning fiscal prudence or legal clarity—instead, it enables governments to extend benefits to remote populations efficiently while maintaining institutional safeguards that inspire confidence in both recipients and international markets.