Marshall Islands Calls its Blockchain Based Digital Currency SOV a “Game Changer”
Joel Telpner, chairman of Sullivan’s Fintech and Blockchain Practice and crypto advisor of Marshall Islands, pointed out that the venture continues to face “a lot” of challenges ahead, but looks forward to making the work “rewarding.”
The Marshall Islands government has claimed that the launch of a digital sovereign currency, titled SOV, will be a “game-changer.” It could also prove to be an example as to how governments act during crisis such as the Covid-19 pandemic.
Telpner stated that Marshall Islands has initiated an 18 month phase in which the token will be issued as what the government calls as “preSOV” and will be later converted into SOV. He said:
“That 18-month period allows us to issue the preSOV in stages and specify the amounts to test the infrastructure while we’re doing it so while preSOV is coming into the market, we’ll be able to test the network, we’ll be able to test the blockchain. We’ll test all the regulatory and compliance provisions, and we’ll be able to test the technology.”
The Sovereign Currency Act of 2018 got approved on February 26, 2018, paving way for the country to start working on its digital currency endeavor. Regarding the preSOV, the attorney said they intend to start disbursing the preliminary token in “the next couple of months”.
They acknowledge the need to improve the manner in which cryptos are introduced to people who may not be technically adept.
“What the Marshall Islands decided to do was to instead of issuing the currency all at once, which when you’re launching a legal tender, putting it in the market all at once is not a good idea.”
The SOV advisor of Marshall Islands also discussed about the manner in which the venture can be a dependable benchmark for other nations who want to move forward along the same track. They hope that “this is a good way for the government to empower the people of their country” and to establish a “self-sovereign identity.”
Regarding the contribution these kinds of digital currencies could offer against the backdrop of Covid-19 issue, Telpner said:
“Think about how much better and more efficient it would have been if we had a digital currency combined with a self-sovereign identity that would have allowed the government to quickly and efficiently get those payments of people that we’re entitled to them.”
Nevertheless, Telpner believes that digital currency need not depend only on blockchain technology:
“Whether or not blockchain solutions become a favored form of creating, issuing, and distributing digital currency, I think, is yet to be seen.”