The RMI is making global headlines with ongoing work toward issuing the world’s first digital legal tender, the SOV (Sovereign). As part of taking a careful and deliberate approach toward this economic endeavor, President Hilda Heine and her delegation met last month with Neema Technologies, the Israel-based company partnering with the RMI government to launch the SOV, on the margins of the UN General Assembly.
Neema will be providing the technology and support to set up and manage the SOV. To ensure technological capacity for SOV transactions in the RMI, Neema decided to establish a foundation that will ensure that SOV “remains a liquid and desirable digital asset,” Minister in Assistance David Paul said.
The SOV team provided updates to the delegation on the progress of their strategy and implementation plans, one of which was securing two well-connected investors who will invest large capital to the SOV venture.
Sole funding will come from 30 percent of the Sovereign units that will go into a “Better Decentralized World Foundation,” which will be taken from the 50 percent that Neema will receive under the initial issuance of the SOV. The Neema team will receive ten percent, and the remaining ten will go to initial investors.
In this regard, this Foundation will be used to complete the development and upgrade of the Yokwe Protocol that will ensure anonymity as well as the safe and secure use of the SOV. The RMI’s 50 percent will be distributed to the RMI’s National Trust Fund, the Nuclear Legacy and Health Care Fund, the Resident-Citizen Allocation Fund, and the Green Climate Fund.
A common question circulating is: why the Marshall Islands? Neema chose the RMI for three specific reasons. First, the RMI is a small developing island nation. Second, it does not have its own currency. Lastly, it is a democracy. The Marshalls is one of the few countries that fit all three requirements.
While the RMI will “lead the way” and reap the “benefits of being the first and most experienced” country in digital currency, there are US bank requirements and concerns from the International Monetary Fund (IMF) that need to be addressed.
With more than the reputation of the RMI on the line, the government has been working with Neema to embed anti-money laundering mechanisms into the digital currency as part of the approach to prove that the Sovereign is committed to positive impact on the economy, the country and its people — who are ultimately the greatest challenge in integrating the RMI into a digital SOV-oriented economy.
Meanwhile the “initial coin offering” (ICO), when the RMI government and Neema Technologies will roll out SOV units for investors to buy and exchange, has been renamed as an “initial monetary offering “(IMO). According to Paul, the “estimated timeline for issuing SOV is a work in progress…we are taking the time necessary to ensure we get this right.”
Read more about this in the October 19, 2018 edition of the Marshall Islands Journal.