Secured Sovereign Collateral for On-Chain Capital Markets

USDM1 is a sovereign-issued, U.S. dollar-denominated, Treasury-backed financial instrument with 24/7 settlement.

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Compatible with industry-standard documentation

USDM1 combines the form-factor of a digital asset with the legal and economic characteristics of fully collateralized sovereign debt, maintaining look-through to the credit of pledged U.S. Treasury instruments.1

In institutional derivatives, repo and financing workflows, it is designed to:

  • Reduce margin requirements
  • Benefit from robust U.S. close-out netting protections
  • Improve capital efficiency and balance sheet treatment
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Capital-efficient USD exposure

USDM1 is not a stablecoin, tokenized fund share, wrapped instrument or CBDC. It is a U.S. dollar denominated sovereign exposure backed 1:1 by pledged U.S. Treasury instruments.1

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Direct sovereign issuance

  • USDM1 is issued by the Republic of the Marshall Islands, a former U.S. territory operating exclusively on the U.S. dollar standard under a Compact of Free Association with the United States.
  • Each unit represents a direct, U.S. dollar-denominated sovereign obligation, secured 1:1 by U.S. Treasury instruments1 in bankruptcy-remote custody.
  • USDM1 is structured in the style of a fully collateralized Brady bond under New York law, advised by Cleary Gottlieb as issuer’s counsel.
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New York law

  • USDM1’s indenture, collateral and redemption rights are enforceable under New York law, preserving the legal and economic rights of holders. The instrument includes an explicit customary waiver of sovereign immunity.
  • USDM1 is supported by a capital markets-grade agent stack, including a U.S.-based trustee, collateral agent and qualified custodian.
  • Holders benefit from enforceable par redemption and a perfected first priority security interest in Treasury collateral under UCC.2

Built for balance sheets

Stablecoins are unsecured corporate payment instruments that sit outside legal netting sets and inflate gross exposures. USDM1 supports treatment as high-quality collateral for margin and financing with 24/7 settlement.

USDM1 for Institutions
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Financial instrument treatment

As a secured, USD-denominated sovereign bond with enforceable par redemption, USDM1 supports accounting treatment aligned with sovereign debt or unrestricted cash equivalents.

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Nettable margin and collateral

USDM1 is structured to support close-out netting under U.S. legal frameworks and may reduce gross exposures when posted bilaterally as IM or VM under industry standard documentation.

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Yield

USDM1 pays a sovereign coupon to holders. As yield-bearing sovereign collateral, it generates interest while posted or pledged under margin agreements.

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24/7 collateral mobility

USDM1 is suitable for use across regulated capital markets activities, improving operational efficiency and reducing settlement risk.

Margin

Post sovereign, Treasury-backed1 collateral in margin workflows with legal enforceability and netting compatibility. Reduce exposure and improve capital efficiency in institutional derivatives.

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Collateral Optimization

Upgrade corporate exposures to yield-bearing sovereign collateral designed for netting, substitution and reuse. Optimize capital efficiency without leaving qualified custody.

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Repo

Deploy USDM1 in repo transactions as a natively issued, Treasury-collateralized1 sovereign instrument designed for title transfer repo, substitution and reuse in institutional frameworks.

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Financing

Enable secured funding using sovereign collateral designed for balance sheet efficiency and institutional financing workflows.

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Treasury Operations

Hold and move USD-denominated sovereign collateral with continuous yield accrual. Streamline treasury operations with institutional-grade safeguards and programmable, 24/7 transfer and settlement.

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Settlement

Settle transactions with a sovereign financial instrument. Move value, post margin and complete transactions in near real-time, reducing counterparty and settlement risk.

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Sovereign issuance, real‑world use

In the Republic of the Marshall Islands, USDM1 was developed as a modern disbursement channel for the world’s first nationwide universal basic income program, set to continue for the next 20 years.

USDM1 enables USD-denominated transfers with legal certainty and 24/7 settlement in one of the world’s most geographically dispersed island nations. The same characteristics enabling trusted benefit delivery also support use as dual-recourse sovereign collateral, expanding access to global capital markets.

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USDM1 ecosystem

USDM1 is supported by leading advisors, regulated intermediaries and global ecosystem partners.

Legal advisor to the RMI
Accounting guidance
Qualified custodian for digital assets
Sub-custodian for cash
Trustee & collateral agent
AML policies & regulatory frameworks
Monitoring, technical intelligence & risk
Supervision & oversight
Coordinating agent

Institutional onboarding

USDM1 is designed for institutional due diligence and transparency requirements.

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Issuance and redemption

USDM1 is issued on blockchain networks against Treasury reserves held in segregated custody.1 Minting and burning correspond to issuance and redemption of sovereign bonds.

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AML / CFT

USDM1 is regulated and supervised by the Marshall Islands Monetary Authority. It adheres to rigorous oversight frameworks for anti-money laundering and sanctions compliance.

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Cybersecurity

USDM1 meets international standards for cybersecurity, fraud and financial crime prevention, including 24/7 continuous threat monitoring and always-on incident response.

Institutional flows run on sovereign collateral

Learn more about USDM1 as a sovereign, Treasury-backed1 financial instrument in working groups with leading global financial institutions.

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