This article first appeared in Digital Edge, The Edge Malaysia Weekly on December 29, 2025 - January 4, 2026

This year has emerged as a landmark year for digital finance, especially stablecoins. While the US enacted the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act in July, ending years of uncertainty with a federal licensing framework for stablecoins, Malaysia finds itself in a different, more nuanced phase of evolution.

Here, the revolution is being quietly coded in the background. Local fintechs operate in “beta” phases on the periphery of the licensed financial sector, while global giants and state-backed entities race to lay the rails for a digital economy where the true potential of digital currency remains locked behind regulatory ambiguity.

The technology is ready, the demand is bubbling, but the rules of engagement remain formative.

The contrast between the US and Malaysian regulatory environments has become a sharp focal point. For Rahul Advani, Ripple’s global co-head of policy, the GENIUS Act was a game-changer.

“The US GENIUS Act is monumental because it ends years of regulatory ambiguity by providing a clear, federal licensing framework for payment stablecoins. It establishes strict rules requiring 100% reserve backing and assigns clear federal oversight,” Rahul tells Digital Edge.

In Malaysia, the path is less direct. While the Securities Commission Malaysia (SC) has pioneered tokenised capital market products through its regulatory sandbox, payment stablecoins — digital tokens pegged to the ringgit for daily transactions — fall under Bank Negara Malaysia.

“Malaysia’s journey is still at a formative stage. When it comes to stablecoins as a means of payment, the legal landscape remains largely ambiguous.

“The immediate regulatory challenge is the lack of specific certainty on how to legally use stablecoins for payments. This crucial step, defining the perimeter and compliance rules, is the clarity the industry needs to match global best practices and unlock innovation in Malaysia,’’ says Rahul.

This ambiguity has created a unique operational environment for local players like Blox, which recently issued a Malaysian ringgit stablecoin product, MYRC.

Blox Blockchain Sdn Bhd co-founder Ethan Chung explains that it engaged with regulators in late 2022. The SC determined the product did not fall under its securities regime, and directed Blox to the central bank.

“Based on professional advice, our understanding is that the minting and redemption of MYRC — our ringgit-denominated stablecoin — does not independently fall under regulatory oversight unless it is used for regulated activities such as payments or remittances. That said, the space remains a developing and somewhat grey area,’’ Chung says.

This has allowed Blox to operate in a “beta phase” where activities are “very exploratory”, he adds.

“We are actively exploring multiple use cases through proof-of-concepts, with the intention of engaging regulators and demonstrating how these solutions can operate safely within the financial system.”

The local stablecoin landscape received a shot of attention when Regent of Johor Tunku Ismail Sultan Ibrahim announced on Dec 9, the launch of RMJDT, a ringgit-backed stablecoin issued on Zetrix AI Bhd’s layer-1 blockchain.

Unlike private beta experiments, RMJDT is being rolled out by the regent’s company, Bullish Aim Sdn Bhd, under a “regulated sandbox framework”.

Backed by ringgit cash deposits and short-term Malaysian government securities, the project aims to boost international use of the ringgit in cross-border trade.

Global giants are also connecting Malaysia to the world via stablecoins. On Dec 1, Mastercard and Thunes announced a collaboration to enable payouts to stablecoin wallets via Mastercard Move.

Similarly, on Nov 18, Grab and StraitsX signed a memorandum of understanding to integrate Web3 wallets into the Grab app, allowing GrabPay merchants to accept stablecoin payments.

Despite high-profile announcements, both Ripple and Blox argue that the future of stablecoins is not about consumers consciously paying with cryptocurrency, but back-end efficiency.

“To the end user, the technology will ultimately be invisible. Stablecoins function as the settlement layer, the underlying infrastructure, while users simply continue interacting with services the way they do today,’’ Chung says.

He likens it to cloud computing. “In the future, people won’t need to understand blockchain to benefit from it. Just as cloud technology has become mainstream — whether a platform runs on AWS or Google Cloud is irrelevant to the customer — blockchain-based settlement will quietly power the experience in the background.”

The friction lies in the separation of messaging and settlement. When a consumer swipes a card, authorisation is instant, but actual money movement can take days.

On the blockchain infrastructure, the message and the money move together. Value transfers at the speed of information.

Rahul also points to structural inefficiencies that programmable money could solve, where use cases for stablecoins are strongly linked to increasing efficiency and closing finance gaps.

This includes cutting the cost and time for sending money across borders by removing middleman banks, letting businesses automate payments to each other — saving time and eliminating delays — and providing the digital infrastructure needed to turn physical assets like bonds into tradable tokens, which speeds up transactions and frees up cash that is usually stuck waiting for deals to clear.

Rahul also points out that the ability to use programmable digital money to streamline supply chain financing is “too significant to ignore”, as it could address the RM21.8 billion small and medium enterprise financing gap and enhance the US$260 billion (RM1.06 trillion) Islamic banking sector.

As Malaysia explores the tokenisation of real-world assets such as bonds or loans on the blockchain, a local currency stablecoin becomes technically necessary, Rahul says.

“Malaysia’s exploration of tokenising capital market products is happening in parallel with its stablecoin assessment. A compliant MYR stablecoin is essential to enable atomic settlement for these tokenised assets, reducing settlement risk and freeing up liquidity.”

The transition from experimental to mainstream hinges on trust, and local players like Blox are acutely aware that compliance is their licence to operate.

Ashwin Chockalingam, Blox’s co-founder and chief financial officer, stresses its conservative approach.

“BLOX and MYRC have been conceived with compliance at the forefront from day one. We have adopted global best practices for regulatory standards, and we are now going further by aligning with the same level of oversight that Malaysian financial institutions are subject to.”

Addressing the risk of a run on the issuer, Ashwin explains that “the issuance of MYRC will always be fully backed 1:1 by fiat currency. Reserve funds are ring-fenced within a trustee structure. At any given time, one MYRC can be redeemed for RM1”.

The industry views Bank Negara’s consultation paper on asset tokenisation, which outlines a road map from 2025 to 2028, as a sign the regulatory door is opening.

“We commend Bank Negara for their openness, particularly through the recent consultation paper on asset tokenisation, which reflects a constructive and forward-looking regulatory stance,” says Chung.

Rahul is equally bullish, stating that Malaysia is at a critical inflection point in adopting stablecoins.

“I firmly expect stablecoin usage in Malaysia to transition from a niche activity to a core part of mainstream fintech offerings over the next few years.”

Demand is already visible, Chung explains. Blox, which reported RM53.19 million in transactions in July this year, has seen growth since then.

“We see a lot more demand coming from at least testing out the product itself,” he says, stopping short of announcing the exact increased amount transacted.

“The appetite is strong. The industry is essentially waiting for Bank Negara to provide the regulatory scaffolding to begin building,” Rahul says.

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