Tinian, a small island in the U.S. territory of the Northern Mariana Islands, is one step closer to launching its own stablecoin after the territory’s Senate voted to override a previous veto from Governor Arnold Palacios.
On May 9, the Senate voted 7-1 in favor of moving forward with legislation that would allow the Tinian government to issue licenses to internet casinos and create a dollar-backed “Tinian Stable Token.”
The bill will now head to the 20-member House of Representatives, where it will require a two-thirds majority to override the governor’s veto and be enacted into law.
Tinian Could Beat Wyoming to Launch First U.S. Government-Issued Stablecoin
If passed, Tinian could become the first U.S. public entity to launch a government-issued stablecoin, edging out the state of Wyoming, which is aiming for a July issuance.
Governor Palacios had vetoed the bill on April 11, citing constitutional concerns and questioning whether the proposed stablecoin could be legally confined to Tinian’s jurisdiction.
Democrat Senator Celina Babauta, who cast the lone dissenting vote, voiced skepticism over the island’s capacity to enforce such a program, citing limited resources and federal compliance constraints.
“We are restricted by federal statutes and must comply with that,” she said.
However, supporters of the bill argue it is a timely solution to Tinian’s ongoing economic struggles.
Senator Karl King-Nabors, who represents Tinian and co-authored the bill, said the legislation promotes transparency and economic diversification.
“This stablecoin is tracked through software,” he noted, “and if anything, it allows for more transparency when it comes to the Tinian Casino Gaming Control Commission.”
The bill, originally introduced by Republican Senator Jude Hofschneider in February, proposes launching a fully collateralized stablecoin called the Marianas US Dollar (MUSD).
The token would be backed by cash and U.S. Treasury bills held by the Tinian Municipal Treasury. It would also be issued via the eCash blockchain, a fork of Bitcoin Cash.
Marianas Rai Corporation, based in Saipan, has been selected as the exclusive infrastructure provider for issuing and redeeming the MUSD.
Debate Over Stablecoin Regulation Heats Up
The proposal comes amid a broader U.S. debate on stablecoin regulation.
Legislative efforts such as the GENIUS Act and the STABLE Act have stalled in Congress due to political tensions tied to former President Donald Trump’s expanding crypto initiatives.
The clash has emerged despite growing bipartisan interest in advancing crypto regulation.
The stablecoin bill, spearheaded by Sen. Bill Hagerty (R-Tenn.), was passed out of the Senate Banking Committee in March with backing from five Democrats.
However, momentum appears to have stalled amid deepening political divisions.
Democratic concerns reportedly intensified during a private caucus meeting last week, where Senate Majority Leader Chuck Schumer urged colleagues not to commit to the bill in its current form.
Meanwhile, Citigroup has projected a dramatic rise in the stablecoin market, forecasting that its total market capitalization could soar from nearly $240 billion today to over $2 trillion by 2030.
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