The Northern Mariana Islands, a U.S. territory in the Pacific, has passed legislation permitting the island of Tinian to issue a government-backed stablecoin called the Marianas US Dollar (MUSD). The bill, initially vetoed by Governor Arnold Palacios over legal and enforcement concerns, was overridden by the territory's House of Representatives with a 14-2 vote following a Senate override on May 9. This makes Tinian potentially the first U.S. public jurisdiction to issue its own government-backed stablecoin.
The stablecoin will be backed by U.S. dollars and Treasury bills held in reserve by the local treasury. The local government has partnered exclusively with Marianas Rai Corporation for blockchain technology infrastructure, planning to deploy MUSD on the eCash blockchain, a fork of Bitcoin Cash ABC. The legislation also authorizes Tinian to license internet casinos, linking the stablecoin rollout to a broader strategy to revive the island's fragile economy, which currently depends heavily on tourism and federal subsidies.
Supporters, including local businessmen and lawmakers such as Representative Patrick San Nicolas, believe the MUSD stablecoin could diversify revenue streams, attract billions in crypto investment, and generate tax revenue without imposing financial burdens on the government. Co-founder Vin Armani sees the initiative as a path toward a self-sustaining digital economy.
Conversely, critics voiced social and legal concerns. Governor Palacios cited "several legal issues" and enforcement safeguards that the bill lacks, while Representative Marissa Flores warned about the ties to online casinos possibly leading to social and cultural disruption. Despite national-level regulatory uncertainty, with federal stablecoin bills like the GENIUS Act and STABLE Act encountering obstacles, the Northern Mariana Islands’ move highlights regional efforts to innovate with digital currencies in a controlled environment.
Marianas Rai Corporation plans further development announcements soon, with observers watching closely to assess whether the eCash blockchain can support real-world stablecoin transactions effectively. This experiment underscores the challenges and opportunities in deploying government-backed stablecoins within a small jurisdiction and the need for balanced innovation and regulation.