The Marshall Islands build a national digital currency based on the Algorand blockchain

The Marshall Islands' national digital currency, called the sovereign Marshallese (SOV), will be built using blockchain technology Algorand.

Algorand published the news on Monday, saying that SFB Technologies, the unit designated to build SOV, chose this blockchain because of its fast transaction speed, scalability, and security. .

Jim Wagner, co-founder and CTO of SFB Technologies, said Algorand's protocol had "full functionality needed to issue, manage and distribute SOV at a global level", ensuring that the digital currency This number "will be built on a secure and scalable platform. "

The Marshall Islands initially announced plans to create SOV in February 2018, when the country's government passed laws to turn a cryptocurrency development project into a legal bidding project. This step is to reduce dependence on the US dollar, which is Marshall's official currency, with the launch of SFB Technologies.

The Marshall Islands, officially the Republic of the Marshall Islands, is an island nation located near the equator on the Pacific Ocean, slightly west of the International Date Line. Geographically, the country is part of a larger group of Micronesia. The Marshall Islands population is 53,158 (census 2011) residing on 29 reefs, including 1,156 islands and islets.

But this initiative has no support from the International Monetary Fund (IMF). In September 2018, the IMF released a 58-page report on the Marshall Islands digital currency plans, saying that implementing this project in the form of a bid “will increase the risk of integrity. economically and macroeconomically, and increase risk with the US dollar exchange rate. "

The IMF added at a time when the island nation needed to "seriously reconsider" the issuance of digital currencies because the potential benefit from this action appears to be "significantly smaller" than the cost that may arise from economic risks, reputation, laws and governance.

The Marshall Islands, despite IMF warnings, are still developing their own national digital currency issuance plan.

According to the island nation's plan, the first batch will have 24 million SOVs released and 40% of which will be sold to people around the world, according to the SOV Development Express website.

“Each year, SOV supply will only increase by 4%. This ratio has been chosen to promote long-term sustainability and is algorithmically fixed by the SOV blockchain, so the supply cannot be manipulated, ”quoted the SOV Development Press release.

The currency will be introduced via pre-sale and future SOV rights will be sold in a series of auctions as part of the scheduled, time-based currency issue. will start soon and will last for 18 months.

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