The first unconditional income country is born! The people of the Marshall Islands receive $800 annually, payable in Crypto.

The First Unconditional Income Country is Born: People of the Marshall Islands Receive $800 Annually

Would you agree to receive a fixed unconditional income from the government every year? The Republic of the Marshall Islands, located in the Pacific, has recently launched a highly watched global initiative, considered by experts as the world’s first national-level Universal Basic Income (UBI) policy.

According to The Guardian, the Marshall Islands government plans to ease the cost of living pressure by distributing approximately $200 (about NT$6,500) to each resident quarterly, totaling $800 annually.

• Note: What is Universal Basic Income (UBI)? A social welfare concept advocating that the government should regularly distribute a fixed amount of money to all citizens without any means-testing or work requirements, ensuring people’s basic survival rights and dignity.

Source: Flickr The first unconditional income country is born, Marshall Islands residents can receive $800 annually

How does UBI work in the Marshall Islands?

The first wave of $200 payments was distributed in late November this year. Residents could choose to receive the funds via traditional bank transfer, check, or through a blockchain encrypted wallet in cryptocurrency.

The Marshall Islands government named this UBI program ENRA, and partnered with the Stellar Development Foundation to distribute via the Stellar blockchain. If residents choose to receive in cryptocurrency, they will receive a bond token called USDM1.

The funding for the ENRA program comes from a custodial fund, mainly derived from compensation paid by the US for past nuclear tests in the area, with assets exceeding $1.3 billion.

A spokesperson from the Marshall Islands Ministry of Finance emphasized that USDM1 is pegged to the US dollar, with each unit backed 1:1 by short-term US Treasury bonds held in trust, and is not an arbitrary currency issuance. It is a digitalized fiscal distribution tool aimed at overcoming the logistical challenges of cash transportation due to island dispersion.

Finance Minister David Paul stated that, in response to population outflow and rising prices, this fund aims to establish a social safety net to ensure no one is left behind.

Source: Getty Images The Marshall Islands Finance Minister David Paul

The Marshall Islands Population of About 40,000 Has Previously Used Cryptocurrency

Located in the Pacific between Hawaii and Australia, the Marshall Islands consists of scattered islands with a population of about 42,000.

As early as 2018, the Marshall Islands attempted to combine cryptocurrency with national policy, trying to create a national cryptocurrency called Sovereign (SOV), but it faced strong concerns from international regulators, ultimately stalling under pressure.

Marshall Islands Opens to Cryptocurrency Receivers, IMF Has Opinions

Although the Marshall Islands is using an asset-backed bond token this time, the International Monetary Fund (IMF) has expressed concerns.

The IMF pointed out that while the underlying technology is innovative, distributing UBI via blockchain still involves financial, fiscal, legal, and reputational risks, especially if robust governance and regulation are lacking, which could impact financial integrity.

Additionally, RMIT University Associate Professor Huy Pham noted that digital payments cannot fully solve financial inclusion issues, as the internet connectivity in the Marshall Islands is unstable.

Data also shows that most residents still prefer traditional methods of receiving funds, with about 60% of the first disbursement directly deposited into bank accounts, and only a small number choosing to use crypto wallets.

Further reading:
IMF warns: Stablecoins may accelerate currency substitution, weakening central bank capital controls

OpenAI and Taiwan’s UBI Experiments Are Opening Policy Imagination

Discussions on Universal Basic Income have been heating up internationally in recent years. OpenAI CEO Sam Altman’s funded organization, OpenResearch, conducted a large-scale experiment in the US.

A three-year experiment involving 3,000 low-income individuals showed that the employment rate among the group receiving $1,000 per month increased from 58% to 72%, similar to the control group that did not receive benefits, directly challenging the myth that unconditional cash leads to laziness.

Taiwanese civil organization UBI Taiwan recently completed its first UBI pilot project, providing support to single-parent families for two years. The results showed that stable cash flow can improve participants’ mental and physical health and parent-child relationships without reducing their willingness to work.

Source: UBI Taiwan Official Website

Empirical experiences from Taiwan and internationally suggest that UBI could become a new safety net beyond existing social welfare systems, offering more policy imagination to address future economic challenges.