Hilda Heine, President of Marshall Islands suggested to introduce a new digital currency for Marshall Islands which almost led to her disqualification as President as she merely survived a no confidence vote, reports claim.
The idea of launching a new digital currency for the nation is not as bad as it turned out for Hilda Heine but the President surely dodged a bullet coming her way and she may even be the one firing it. Lucky for her, her idea did not turn everyone against her.
As the Marshallese parliament voted for a poll whether to keep Ms. Heine as President or to abolish her from her duties, a close affair saw Ms. Heine one vote short of being voted out by motion of no confidence from the parliament. Good thing she made some friends.
But why did the innocent idea of creating a separate new digital currency for the nation almost cost Hilda Heine her honor?
Sources affirm that the plan to introduce a new digital currency was initially approved by Marshall Island’s parliament and a name had also been decided for the cryptocurrency; Sovereignty (SOV). Plans were ready to introduce the new cryptocurrency in February and distribute it nationwide and it was also decided to be traded in the country’s major currency, US dollars.
Despite initial support from the parliament, many opposed the idea of introducing the cryptocurrency which included former President, Casten Nemra and eight other senators who criticized the idea. Many pronounced the new plan to be an effort to put stains on the nation’s reputation.
As apathetic as it sounds, it looked like Casten Nemra was searching for opportunities to pull down the government. He recalled and emphasized on the government’s inability to scrutinize the loss Marshall Islands had faced worth $1 billion. The US government set up a trust, the Marshall Islands Trust Fund, to look out for the people affected by nuclear tests done near the country and unknowingly, $1 billion went missing from the trust fund. This gave rise to the opposition who highlighted the concern in order to break the government.
The accusations added up and strengthened for the opposition as further claims piled up. The plan to turn the Rongelap Attol into an administrative institution, suggested by Chinese which would also include a tax free port and registrations for offshore companies was supported by many of the senators who were opposing Hilda Heine. However, Hilda Heine saw it from a different perspective and said that the plan was nothing more than a foreign invasion on Marshallese land. This prompted the opposition against the government as they considered it to be an uplift from a business point of view.
On addressing Nitijela, the Marshall Island’s parliament, Hilda Heine said that the opposition’s continuous efforts to take down the government was a depiction on the political dynamics of the country and its practices. Ruling out claims by her non-compliance, the Marshall Island’s President said that the introduction of Sovereignty (SOV) is a “historic moment for our people”. And she could be right, as we have seen how the introduction of digital currency has revolutionized practices in the world of exchange, it might as well bring positive changes in the payment procedures of Marshall Islands.
Reports say that the idea of launching a new digital currency was presented to the Marshallese government by an Israeli start-up, Neema. Neema offered the Marshallese government partnership in developing and launching the new cryptocurrency and assured them that the cryptocurrency would see a success of around $30 million, half of which would go to Neema and many were also convinced by the idea.
Neema’s owner, Barak Ben-Ezer believed that the launch would be a huge success for Marshall Islands as it would give the nation a separate identity in the world of trade, he said:
As a practical matter, SOV then becomes real money from a legal standpoint. Finally, without capital gains tax, without a securities regulator claiming that the currency is stock. SOV is a sovereign currency like the dollar, the euro and the yen.
On a positive note, Finance Minister, Brenson Wase announced that the Marshallese government has decided to go with the plan to launch a new cryptocurrency as a second legal tender and the nation looks to complete the process on fulfilling requirements set by IMF (International Monetary Fund, the US and UK.
However, the nation has been warned by IMF about the consequences that come or that may come with introducing a digital currency as a second legal tender which could cause serious damages to the country’s economy.
Hence, Hilda Heine came close to being disqualified for her efforts to introduce a new cryptocurrency for the nation but finally achieved what she stood firm for. Beneficial or not, we will leave it for judgement once the cryptocurrency starts operating.