Marshall Islands President Faces No Confidence Vote Due to National Crypto Plans

The President of the Republic of the Marshall Islands Hilda Heine faces a vote of no confidence due to her administration's plans to introduce a national digital currency, Radio New Zealand News reported Nov. 5.The Marshallese parliament initially endorsed the creation of the national digital currency, which would be called the Sovereign, in February of this year.

Heine said then that the introduction of the SOV is "Another step of manifesting our national liberty."

On Monday, a group of eight senators reportedly introduced a vote of no confidence in the Heine administration.

The Marshallese constitution requires that a vote is held between five and ten days after a no confidence motion is introduced in the country's parliament, the Nitijela.

In the vote, former president Casten Nemra stated that the plans of establishing a digital currency as legal tender had a negative impact on the reputation of the country.

In September, the IMF warned the government of the Marshall Islands about the risks of adopting a cryptocurrency as a second legal tender, stating that it will pose risks to the country's financial integrity, as well as relationships with foreign banks.

Another factor in the senators' vote of no confidence is the proposal for a special investor haven, which authorities from Rongelap Atoll made earlier this year.

The Heine administration rejected the proposition, saying that the offer violated a number of laws and international financial agreements between the Marshall Islands and other countries.

Notably, the same group of senators who introduced the no confidence motion in Heine also support the formation of the Rongelap Atoll Special Administrative Region.

Heine's announcement regarding the introduction of the state digital currency came at the same time that Venezuela launched a national cryptocurrency called the Petro.