It’s always interesting to see governments making the effort to implement blockchain technology. The SOV Development Fund was recently formed by the Republic of the Marshal Islands (RMI) in order to aid in the development of a national digital currency.
The SOV Development Fund will be a non-profit organization. Its main goal will be to develop the national digital currency, the Sovereign (SOV). Seven directors will oversee the fund, two of which would be government appointed. The company which is charged with developing the SOV’s blockchain, SFB Technologies, will also appoint 2 directors.
The last 3 director choices will be done unanimously by the 4 chosen directors. It’s very likely that the chosen candidates will be international blockchain experts and/or experts in monetary policies.
SOV Development Fund is playing the long game
The Chief Economist for the SOV, Peter Dittus, went into detail about the SOV Development Fund and its long-term goals:
“Our aim to is keep the volatility of the SOV to a minimum. This is why we will buy and sell the SOV against the USD and other targets of our choice.”
Last year, the International Monetary Fund (IMF) gave many warnings to the RMI about having a digital currency as a second legal tender.
The RMI did not listen to the IMF’s warning and kept walking the blockchain path. Earlier this year, Neema, an Israeli-based company partnered up with the government in order to develop the SOV.
That being said, many United States regulators are concerned that the SOV Development Fund is not fully taking into consideration the negative impact the digital currency might have on the country’s already existing banks. There is also the huge risk of money laundering.
Neema tried to appease regulators by stating that every single SOV account will be identified. All buyers and sellers will be check against the United States Office of Foreign Asset Control.
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