KUALA LUMPUR (July 22): Blox Blockchain Sdn Bhd (Blox), the Malaysia-based blockchain start-up, opened up its Malaysian ringgit stablecoin product, MYRC, to the public for feedback and testing on Monday (July 21). 

As at July 18, a total of 644 users who have gone through the know-your-customer (KYC) process through the Blox online platform transacted a total of RM53.19 million in MYRC. The total MYRC in circulation was RM1.16 million.

Stablecoin is a type of cryptocurrency designed to have stable value, typically pegged to a real-world asset like fiat currency.

Ethan Chung, Blox’s co-founder and CEO said the MYRC is backed by the Malaysian ringgit at a one-to-one ratio.  

Stablecoin is also often seen as privately issued digital money not backed by the government and central bank. Most stablecoins, including the MYRC, are not considered legal tender.

During an interview with The Edge, Chung said the MYRC is yet to be regulated by Bank Negara Malaysia (BNM). However, the firm has contacted and been engaging the central bank before the start-up launched its closed beta version in mid-2023, offering its product to a limited number of invited users.

Ashwin Chockalingam, its co-founder and chief financial officer, said the firm has also reached out to the Securities Commission Malaysia, but was directed to the central bank as stablecoin functions more like a currency.

The firm isn’t regulated at the moment and hasn’t participated in any sandbox under the BNM and SC. 

“We aren't a right fit for the [existing] standard regulatory sandboxes as they have certain criteria to get admitted, including ‘regulatory impediment’. But there aren’t regulations that focus on stablecoin [at this point in time],” he said.

However, Chung and Chockalingam said they are looking forward to participating in the Digital Asset Innovation Hub (DAIB), launched by Prime Minister Datuk Seri Anwar Ibrahim during the Sasana Symposium 2025 on June 17.

According to news reports, the initiative will allow use cases such as programmable payments, ringgit-backed stablecoins and supply chain financing to be explored in a controlled environment. It will serve as a regulatory sandbox that enables financial technology (fintech) and digital asset firms to test new technology with the oversight of the BNM.

“That will be most appropriate for us. We are looking forward to it. We want to make sure what we do is within the law and our [stablecoin] holders are protected.

“Even for now, we observe the market and apply global standards to our operation, including a full KYC process. And clients’ funds are held by third parties,” he said.

He added that the general public can look up Blox's monthly attestations report, produced by its auditor to ensure that the MYRC in circulation is backed by the ringgit on a one-to-one ratio.

As at the time of writing, Chung said Blox isn’t allowed to perform regulated activities, including end-to-end payments and remittance activities.

“What we are trying to do, such as the creation and redemption of MYRC, isn’t categorised as regulated activity,” he said.

Chung said Blox is a participant of the PayNet Fintech Hub, the country’s first fintech-focused community and accelerator programme.

According to PayNet, the hub aims to accelerate fintech growth in Malaysia by providing those firms with direct access to capital, key industry connections, financial incentives and the ability to learn from and work alongside global powerhouses.

“We are very grateful that the PayNet Fintech hub presents us with an avenue to test things appropriately. We wish to build more proof of concepts (POCs) to showcase the blockchain value, especially for payments, and to get more data points for the regulators,” said Chung. 

Chung explained that Blox users can register themselves on its website by going through the KYC process, which include identification card and face scan, and deposit ringgit to mint (or create) MYRC.

After setting up the security protocol, its users can opt to withdraw their MYRC to a crypto wallet, such as Metamask, or convert their MYRC back to the ringgit fiat currency through internet banking. The funds will be reflected in their bank account the next day.

According to an announcement on the website, the firm is transitioning its reserved account, which holds the fiat Malaysian ringgit that backs the MYRC, from CIMB Bank Bhd to Malayan Bank Bhd.

It also mentioned that as part of this transition, the reserved account will be placed under the custody and trustee services of Universal Trustee (Malaysia) Bhd. The account will be held in the name of UTMB and Blox for transparency, security and compliance purposes.

Chung said the 644 users registered with the platform include blockchain developers who use the MYRC for payroll and suppliers.

“They [mint MYRC with us] and pass them to their employees, who have done their KYC with us. And their employees redeem MYRC for ringgit,” he says.

Chockalingam said the MYRC is also being used by blockchain developers for their tokenisation projects. “When people are building their POCs, they want to build them with ringgit stablecoin. So, they’ve been using us to test their products as well.”

Yet, Chung said the firm’s main focus isn’t on the retail market, but to make the MYRC a solution for settlement.

In banking, settlement refers to the process of transferring funds or securities between two parties to finalise a transaction.

“Our intention is really on settlement. For instance, you can be using an e-wallet or global payment networks for transactions, they can settle the ringgit payments with MYRC on the blockchain. That’s what we want to focus on. But we need a meaningful POC and get approval from the BNM,” he said.

In 2022, the five co-founders of Blox, including Chung and Chockalingam, were interested in the idea of fractionalising properties with blockchain technology. But they quickly realised there is no ringgit stablecoin in the market and decided to set up Blox.

Chung is the founder of BuyMall.com.my, the cross border e-commerce platform partially acquired by Revenue Group Bhd.

Chockalingam is the founder and investment director at venture capital and venture debt firm Winacore Capital from 2021 to 2024, according to its LinkedIn profile. He says the firm isn’t licensed by the SC as it invests only with personal funds and funds sourced from outside of Malaysia.

According to the CTOS report, Blox’s largest shareholders, as at July 2, were Chung Wai Fong, Daenavan Thaiveegan, Ng Joey and Chockalingam. Daenavan is Blox’s chief technology officer while Ng is chief product officer.

Other investors include Colbert Low, a veteran in the local crypto industry; Yoon Jun Jie, founder of licensed peer-to-peer financing firm Capsphere; and AIMZ Capital Sdn Bhd, a firm founded by Alief Iskandar Mohd Zuhri in 2022 that invests in early stage start-ups, primarily in Southeast Asia, according to its official website.