Universal Basic Income Initiative in the Marshall Islands
In an innovative approach to social welfare, the Marshall Islands has launched a universal basic income (UBI) initiative, providing its citizens with an annual payment of $800. This groundbreaking program allows residents the choice of receiving the funds via various methods including cryptocurrency, specifically a stablecoin designed to aid financial transactions across the archipelago’s remote islands.
Program Details and Objectives
According to reports from The Guardian, the UBI initiative entails quarterly payouts of roughly $200 for every citizen, aimed at alleviating the financial burden of rising living expenses and addressing issues related to emigration. The inaugural payments were disbursed in late November, and recipients can select to receive their funds through traditional banking channels, printed checks, or a new government-backed digital wallet that utilizes blockchain technology to facilitate these transactions.
Finance Minister David Paul emphasized that the program seeks to enhance financial inclusion and serve as a safety net rather than a replacement for employment income. He highlighted that the initiative is designed not only to provide monetary support but also to uplift community morale.
Challenges and Financial Support
The Marshall Islands, a Pacific nation with about 42,000 residents situated between Hawaii and Australia, grapples with significant economic and geographical hurdles, particularly in delivering public services to its widely dispersed populations living on small atolls. Officials believe that integrating cryptocurrency into the UBI rollout can alleviate some of these logistical challenges.
This social assistance program is financially supported by a U.S. trust established to compensate the Marshall Islands for years of nuclear testing conducted by the U.S. government, accumulating over $1.3 billion in assets. The U.S. has also pledged an additional $500 million in funding until 2027.
Global Significance and Adoption
Dr. Huy Pham, an associate professor and leader in crypto-fintech at RMIT University, claims this implementation marks an unprecedented event on a global scale. He indicates that employing blockchain technology in a nationwide UBI structure is a rarity, with the payments being dispensed in a stablecoin pegged to the U.S. dollar, ensuring stability in value while enabling rapid and transparent transfers across the islands.
However, initial adoption of the digital wallet feature has been limited, with data indicating that around 60% of recipients chose traditional bank deposits, while a significant portion opted for checks, leaving only a small fraction utilizing the digital wallet to claim their UBI benefits.
Related Developments in Global UBI
In related developments, Sam Altman’s World project, which began as Worldcoin, aims to establish a global UBI system through its blockchain framework. This project includes biometric verification to ensure unique human identity, rewarding users with its native token, WLD, as a potential form of UBI. World also introduced the World Chain, an Ethereum layer-2 solution, last year to support its 15 million verified users, all of whom are authenticated through iris scans, facilitating the provision of the digital currency within the network.
