Paradigm leads $5.5M seed for M1X Global’s USDM1 token

Paradigm led a $5.5 million seed funding round in M1X Global to help scale USDM1 and expand the company’s institutional reach, the firm said. Breed VC was the only other participant in the oversubscribed equity round, which brings M1X Global’s total financing to $8.5 million after a $3 million angel round closed in March.

Paradigm preempted the fundraising process and took the bulk of the allocation alongside Breed VC, the company said. No investor received board, advisory or observer seats as part of the seed round. The March angel round included backers such as former Coinbase CTO Balaji Srinivasan and Cumberland Labs CEO Tama Churchouse.

USDM1 is a U.S. dollar–denominated sovereign debt instrument tokenized and issued natively on public blockchains by the Republic of the Marshall Islands. Each token is backed one-to-one by short-duration U.S. Treasury securities and governed under New York law. The asset launched on Stellar and is also available on Canton and Solana.

The Marshall Islands has used USDM1 for domestic government aid disbursements through the Lomalo digital wallet, which the company says lets payments settle in seconds instead of relying on correspondent banking networks. M1X Global is positioning USDM1 for institutional uses such as repo, margin and secured financing markets that can operate round the clock.

M1X Global highlighted legal and custody features intended for regulated markets. USDM1 is custodied on Anchorage Digital’s federally regulated platform, structured to be bankruptcy-remote and able to be included in legal netting sets. The firm pointed to an integration with Bank of Guam, an FDIC-insured U.S. bank, to link the token with banking infrastructure.

The company has engaged institutional participants to test onchain sovereign collateral. Working groups involving Bank of America, Citadel Securities, Virtu Financial, Tradeweb and the DTCC have evaluated how tokenized government debt could affect collateral movement and settlement.

Jordan Goldman, M1X Global’s president and chief operating officer, described USDM1 as a native onchain form of sovereign debt intended to fit into existing financing markets while supporting continuous settlement. Arjun Balaji, a partner at Paradigm, added, “24/7 markets require collateral that can move 24/7. USDM1 shows how sovereign debt can be issued natively onchain.”

M1X Global’s near-term priority is institutional adoption. The company plans to increase support among banks, custodians, alternative trading systems, margin and risk platforms, off-exchange settlement networks and post-trade infrastructure, and to expand acceptance of USDM1 as collateral across over-the-counter trading desks, prime brokerages and exchanges. The firm will consider programs with additional governments as opportunities arise.

M1X Global has 11 employees and plans to hire across several functions as it scales. The company said it faces an educational challenge in onboarding institutions to a new onchain sovereign instrument while explaining how the structure relates to long-standing legal precedents.