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The Marshall Islands has introduced a national universal basic income (UBI) program that allows citizens to receive payments through cryptocurrency, making it the first country to roll out a UBI scheme with a blockchain-based payment option at a nationwide level. The initiative aims to ease rising living costs while ensuring financial support reaches citizens across the country’s geographically dispersed islands.
1. How the UBI Program Works
Under the scheme, every eligible citizen of the Marshall Islands receives a fixed quarterly payment from the government.
Key details:
- Each citizen receives approximately $200 every three months, totaling around $800 per year
- Payments can be received via bank transfer, paper check, or cryptocurrency
- The crypto option is delivered through a government-backed digital wallet using a stablecoin pegged to the US dollar
- The first payments were distributed in late November
Government officials emphasize that the payments are designed to support daily living costs, not replace employment income.
2. Why the Government Chose Blockchain
The Marshall Islands is made up of hundreds of islands spread across the Pacific Ocean, making traditional payment distribution costly and logistically complex.
Reasons for adopting blockchain payments include:
- Reaching residents in remote and outer islands more efficiently
- Reducing reliance on physical banking infrastructure
- Using stablecoins to avoid exposure to crypto price volatility
- Leveraging blockchain for secure and transparent fund transfers
Officials describe the digital option as a practical tool rather than a push toward full crypto adoption.
3. Funding the National UBI Scheme
The program is financed through a long-term trust fund established under agreements with the United States.
Funding structure:
- The trust fund holds over $1.3 billion in assets
- The US has committed an additional $500 million through 2027
- Part of the funding framework is linked to compensation for historic US nuclear testing in the region
This structure allows the government to fund recurring payments without relying on short-term budget adjustments.
4. Early Adoption and Public Response
While the crypto option has attracted global attention, most recipients are currently opting for traditional payment methods.
Initial uptake data shows:
- Around 60% of payments were sent directly to bank accounts
- The remainder were issued as paper checks
- Only a small number of recipients have chosen the digital wallet option so far
Officials involved in the rollout report that recipients are using the funds for essentials such as food and household needs, with some spending coinciding with local cultural celebrations.
5. Challenges and Expert Concerns
Despite its innovation, experts note that the program faces limitations.
Key concerns include:
- Patchy internet connectivity across the islands
- Limited smartphone access for some citizens
- The need for strong governance and oversight of digital payments
- Potential financial and reputational risks highlighted by international institutions, including the IMF
Analysts stress that digital payments alone do not guarantee financial inclusion without supporting infrastructure.
6. A Broader Experiment for Small Island Nations
This is not the Marshall Islands’ first attempt to explore digital currency. A previous plan to launch a national cryptocurrency in 2018 was abandoned following international regulatory warnings. However, experts believe the current UBI initiative is more measured and focused.
For small island states with limited banking infrastructure, a digital payment option could reduce friction and improve access to government support—if implemented carefully.
Conclusion
The Marshall Islands’ crypto-enabled universal basic income program represents a rare and ambitious national experiment. By combining traditional payment systems with a blockchain-based option, the government is testing whether digital finance can improve accessibility in a geographically fragmented nation. While adoption of the crypto option remains limited and challenges persist, the initiative offers valuable insights into how blockchain technology might support social programs in small and remote economies.
This article reflects the opinions of the publisher based on available information at the time of writing. It is not intended to provide financial advice, and it does not necessarily represent the views of the news site or its affiliates. Readers are encouraged to conduct further research or consult with a financial advisor before making any investment decisions.
