M1X has chosen DFNS as its core banking system and wallet infrastructure. M1X works with governments to bring sovereign financial instruments onto digital rails, and its flagship program is one of the most consequential real-world deployments of onchain finance to date: USDM1, the first digital sovereign debt instrument issued natively on a blockchain, developed with the Republic of the Marshall Islands. For work at that level, sovereign issuance, nationwide disbursements, institutional collateral, the layer that holds accounts, moves value, and enforces controls has to meet the standard of the instrument itself. That is what DFNS provides.
M1X, building the sovereign layer of onchain capital markets
M1X unlocks applications of blockchain technology across public sector programs and institutional markets. It partners with governments to identify opportunities, coordinate legal, operational, and technological expertise, and support long-term economic development, with a focus on durable systems inside clear legal and governance frameworks rather than experiments.
The proof is in the Marshall Islands. Working with the government, M1X helped design and implement USDM1: a sovereign, USD-denominated financial instrument issued natively onchain, first on the Stellar network and now also available on Canton and Solana, collateralized 1:1 by short-duration U.S. Treasuries held by an independent U.S. trust company, and structured in the style of a fully collateralized Brady bond under New York law, with a first-priority perfected security interest for holders and an explicit waiver of sovereign immunity. Cleary Gottlieb advised the Republic as issuer’s counsel, and the instrument is regulated and supervised by the Marshall Islands Monetary Authority. It is not a stablecoin, not a wrapped asset, and not a CBDC. It is sovereign debt, with the form factor of a digital asset and the legal machinery of a bond. Before USDM1, sovereign debt, one of the largest asset classes in the world, simply did not exist natively onchain.
What USDM1 does is just as significant as what it is. In December 2025, the Marshall Islands executed the world’s first onchain disbursement of universal basic income under its national ENRA program: quarterly payments of around $200 to eligible citizens, set to run for twenty years, with each citizen choosing to receive funds in a digital wallet, by cheque, or by bank deposit. The context makes the point: the Pacific has been hit hard by the loss of correspondent banking relationships, and citizens on remote atolls had waited on physical cash shipments. A legally enforceable, Treasury-backed instrument moving on digital rails turned that into transfers settling in seconds, and the rails keep extending, with cash-out through MoneyGram locations going live and an integration with Bank of Guam, an FDIC-insured U.S. bank, connecting USDM1 to regulated banking infrastructure.
Then USDM1 crossed from the Pacific to Wall Street. In April 2026, Anchorage Digital, home to America’s first federally regulated crypto bank, made USDM1 available on its custody platform, providing settlement, custody, and collateral management so institutions can hold a sovereign, Treasury-backed instrument and integrate it into 24/7 margin, repo, and financing workflows. The instrument has already been used in institutional working groups involving Bank of America, Citadel Securities, Virtu Financial, Tradeweb, and DTCC to evaluate how natively issued sovereign debt can improve collateral mobility and settlement, answering a need both ISDA and the FIA have identified for high-quality government collateral that can operate in 24/7 tokenized markets.
The market is backing the thesis. This July, M1X raised a $5.5 million seed round led by Paradigm, with Breed VC participating, bringing total funding to $8.5 million after a $3 million angel round earlier this year backed by investors including Balaji Srinivasan and Cumberland Labs CEO Tama Churchouse. As Paradigm’s Arjun Balaji put it announcing the round: “24/7 markets require collateral that can move 24/7.” From quarterly payments on remote atolls to collateral for swap dealers, on one instrument: that is the sovereign layer M1X is building.
Why M1X chose DFNS
The word sovereign is the connection. M1X builds sovereign instruments; DFNS is the sovereign infrastructure layer, the core banking platform that sits between an institution’s business logic and the networks it runs on, deployable wherever its operator’s obligations require.
A few things made DFNS the right foundation:
- The full operating layer, not a wallet tool. Sovereign programs need accounts, transaction processing, treasury, asset servicing, and governance as one system. DFNS provides exactly that through one API: Wallet-as-a-Service as the account layer, Transaction Management across the full lifecycle, Treasury and Tokenization to manage balances and service assets end to end, and a Policy Engine enforcing quorums, limits, and roles before anything is signed. For a program where issuance, redemption, and disbursement are matters of public record, every action lands in a complete, auditable trail.
- Governance worthy of a sovereign program. Multi-party approval quorums, allowlists, velocity controls, and screening are enforced at the infrastructure layer, below the API, so controls hold even if credentials are compromised. Programs answerable to ministries, trustees, and auditors need controls they can prove, not just describe.
- Native support for every network USDM1 lives on. USDM1 operates today on Stellar, Canton, and Solana. DFNS supports all three as Tier-1 networks: wallets, transfers, trustline opt-ins on Stellar through our Accept Inbound Asset operation, full indexing, and webhooks, under one control plane. As M1X expands across banks, custodians, trading venues, and post-trade infrastructure, DFNS extends with it, across 100+ networks, without re-architecting.
- Deployment sovereignty. DFNS runs as SaaS, hybrid, or fully on-premises, with MPC or HSM key infrastructure and jurisdictional control over key material. For work with governments, where infrastructure residency and operational control are conditions rather than preferences, that flexibility is a precondition.
- Security as the floor. Keys are never assembled in one place. DFNS has maintained zero breaches and zero key losses since 2020, operates under SOC 2 Type II and ISO 27001, 27017, and 27018 certifications, and acts strictly as a technology provider: custody and control remain within the program’s own legal and regulatory structure.
A foundation for sovereign finance onchain
USDM1 demonstrated something the industry has talked about for years: a sovereign instrument, legally enforceable, fully collateralized, and issued natively onchain, serving citizens and institutions from the same rails, from a quarterly payment on a remote atoll to collateral in a New York financing workflow.
Together, M1X and DFNS pair the legal and programmatic architecture of sovereign instruments with the core banking platform to operate them: accounts, transactions, treasury, tokenization, and governance, secured and auditable end to end. As more governments and institutions bring sovereign finance onchain, this is the foundation it runs on.
Start building on DFNS today: app.dfns.io/get-started