In January, the West Pacific island nation of Palau launched the world’s first digital residency program utilizing blockchain, underscoring its need to create a brand new borderless monetary hub counting on crypto and blockchain know-how.
By a partnership with Palo Alto-based blockchain builders Cryptic Labs, Palau is launching the Root Name System (RNS), a digital residency program open to anybody on this planet. Calling itself a “gateway to the borderless monetary world,” this system offers authorised customers digital resident ID playing cards within the type of non-fungible tokens (NFT), permitting them to obtain advantages in Palau’s new digital-first financial system, which can provide providers like bodily addresses and transport.
President Surangel Whipps sees the creation of the digital ID as one strategy to diversify Palau’s tourism and fishing-driven financial system, which was battered through the pandemic.
Costing $100 per particular person, the ID would characteristic vital verification options, together with know-your-customer (KYC), anti-money laundering (AML), and anti-terrorism financing verification processes. It could be re-issued every year.
“Our Digital Residency Program can have capability for internationally acknowledged requirements of identification verification to make sure that Palau upholds the rule of regulation and our reputational integrity,” mentioned President Whipps, who’s hoping this system will assist the small island nation undertake a digital-first mindset like Singapore or El Salvador. “We welcome all international residents to use to take part in Palau’s digital residency program.”
This system presently has a waitlist of greater than 60,000 folks, with candidates allowed to transfer 100 spots on the waitlist by means of referrals.
That is the second leap into blockchain for Palau. In November, the country partnered with Ripple to create a USD-backed digital forex to facilitate cross-border remittances in an environmentally-friendly method. Ripple says its carbon-neutral blockchain community is 120,000 occasions extra energy-efficient than others and provides decrease prices and quicker speeds.
Cryptic Labs has not disclosed the blockchain protocol behind the digital residency program.
Palau is presently exploring organising the blockchain and cryptocurrency infrastructure to help the digital residency, together with growing a stablecoin, establishing crypto exchanges, and creating a company registry for blockchain and crypto corporations.
Initially skeptical of crypto, the island nation of Palau beforehand rejected crypto on account of its affiliation with illicit finance linked to medicine and terrorism. Nonetheless, it has not too long ago trumpeted the financial benefits of blockchain and crypto, claiming it’s a part of the nation’s new financial imaginative and prescient that can assist the Republic of Palau transfer out of the pandemic and diversify its financial system.
Palau was spared the brunt of the pandemic within the early section and solely logged its first case of COVID-19 final August.