Northern Mariana stablecoin bill passes as legislature overrides governor’s veto

The Northern Mariana stablecoin bill has officially become law after the territory’s legislature overwhelmingly voted to override Governor Arnold Palacios’ veto, clearing the path for Tinian, a tiny Pacific island with just 2,000 residents, to issue the first government-backed stablecoin in U.S. jurisdiction.

The historic move, driven by a 14-2 House vote following a 7-1 Senate override, positions the Northern Mariana Islands ahead of Wyoming, which had aimed to launch its own state stablecoin by July. The newly enacted legislation authorizes the Tinian Municipal Treasury to manage the “Tinian Stable Token” (MUSD), a dollar-pegged digital currency backed by cash reserves and U.S. Treasury bills, marking a major milestone in public-sector crypto adoption.

Northern Mariana stablecoin bill secures overwhelming support

In a decisive 14-2 vote, the Northern Mariana Islands House overturned Governor Palacios’ April veto, following a 7-1 Senate override earlier in May. The Northern Mariana stablecoin bill, which also legalizes internet gaming licenses, was initially passed unanimously by Tinian’s four-member delegation in March.

The legislation authorizes the Tinian Municipal Treasury to issue, manage, and redeem the “Tinian Stable Token” (MUSD), backed by US dollars and Treasury bills. “This bill unlocks our potential without depending on tourists or federal subsidies,” said Republican Representative Patrick San Nicolas, a key supporter. “It builds a digital industry generating revenue from a licensed jurisdiction.”

Governor’s concerns overridden amid economic urgency

Governor Palacios had vetoed the Northern Mariana stablecoin bill, citing constitutional concerns, unenforceable gambling restrictions, and insufficient anti-illegal gaming measures. However, lawmakers argued the territory’s economic crisis demanded bold action.

Vin Armani, co-founder of Marianas Rai Corp—the firm managing MUSD’s infrastructure—told legislators the bill could “attract billions in investment and tax revenue.” Clyde Norita, a local entrepreneur, echoed this, stating,

“Our economy is dying out. This allows businesses without harming our culture or environment.”

Critics like Independent Representative Marissa Flores, who voted against the override, called it a “bitter pill,” warning, “When we’re desperate, we always turn to casinos. I don’t like deciding under fear.”

Tinian’s stablecoin: A blueprint for small economies?

With just 2,000 residents, Tinian’s tourism-dependent economy could be transformed by the Northern Mariana stablecoin bill. The MUSD will operate on the eCash blockchain, a Bitcoin Cash fork. Proponents argue it offers a model for small jurisdictions to leverage crypto innovation.

Wyoming, which plans to issue its own stablecoin by July, now faces competition. “This isn’t just about gaming revenue,” said San Nicolas. “It’s about positioning the Marianas as a digital finance hub.”

A Marianas Rai Corp spokesperson confirmed further MUSD details will emerge May 19. If successful, the Northern Mariana stablecoin bill could inspire other US territories to explore similar initiatives.

Legal and regulatory hurdles remain

Despite the override, questions linger. The US Treasury has warned that territorial stablecoins may face federal scrutiny, particularly regarding anti-money laundering compliance. Governor Palacios’ veto letter emphasized these risks, but supporters insist the Northern Mariana stablecoin bill includes safeguards.

“The reserves will be fully audited,” Armani assured lawmakers. “This is a transparent, compliant system.”

However, challenges remain—federal regulators may scrutinize its compliance, and critics warn of risks tied to gambling-linked revenue. If successful, the model could redefine how isolated economies leverage blockchain technology, offering a blueprint for digital financial sovereignty. As the world watches, Tinian’s experiment may prove whether stablecoins can truly empower local governments in the crypto era.

For now, all eyes are on Tinian. If the MUSD launches smoothly, the Northern Mariana stablecoin bill may mark a turning point for crypto adoption in public finance—proving even the smallest economies can play in the digital currency arena. The Bit Gazette will keep an eye on events and report developments.