The Sovereign (SOV) digital currency looks set to become the first decentralized national digital currency. It soon could be used in the Marshall Islands as same as the US dollar. Cryptocurrency can also be used as a legal tender in such a small nation and cryptocurrency adoption along the sidelines of cash can bring major digital transformation. Marshall Island is one of the first countries that said they would accept cryptocurrency as a national legal tender. It passed a key bill this week for the creation of SOV, which would be allocated to the SOV’s creators Neema. The current crypto strategy is just making the prospect promote the investment in Marshall Island using the new currency.
Marshall Island President Hilda Heine said in a statement that this is a historic movement for the nation and its people. Issuing the countries first currency that can be used along with the US dollars. It’s one of the ways our nation can exercise national liberty. According to the plan, 2.4 million SOV will be issued to the Marshallese people and the Startup Neema is set to raise $15 million from the launch almost half to the price of launch.
The International Monetary Fund (IMF) has criticized the decisions and the rising number of concerns including the risk of money laundering and also the risk that Marshall Island could soon lose its only corresponding banking realistic with the US. The IMF added that currently there is no risk mitigating infrastructure in place, with the issuance of decentralized digital currency as second legal tender in the Island will increase the risk in Macro-economics and financial integrity. IMF cannot prevent the issuance of SOV in the Marshall Island but the objection could see a retraction if the aid to the island is curtailed. United States contributes close to $70 million in financial assistance, with US Treasury raising the objections about illegal transitions in the system. In the SOV the users will be required to register their identity, so the digital currency won’t follow the pseudo-anonymous nature of Bitcoin.