Malaysia’s central bank, Bank Negara Malaysia (BNM), has launched an expanded digital asset regulatory sandbox under its Digital Asset Innovation Hub (DAIH) to pilot stablecoins and tokenized financial products. The initiative is aimed at testing how digital representations of the Malaysian ringgit and other tokenized financial instruments could function in real-world settings within a controlled and regulated environment.
The sandbox will focus on ringgit-backed stablecoins, which are digital tokens pegged to the Malaysian currency, as well as tokenized bank deposits. BNM said the program will allow it to study how these digital assets operate in practice and whether they can enhance efficiency in financial transactions, particularly cross-border payments. The findings may also help inform future decisions regarding the possible introduction of a central bank digital currency (CBDC).
In a statement, BNM said the testing will enable the central bank to assess the implications of such innovations on monetary and financial stability while shaping its policy direction in these areas. The bank added that it intends to provide greater clarity on the use of ringgit stablecoins and tokenized deposits by the end of 2026. A CBDC refers to a digital form of money issued and regulated by a central bank.
Several major financial institutions are participating in the sandbox trials, including Standard Chartered Bank, CIMB Group Holdings, Maybank, and Capital A. The participating institutions are also evaluating Shariah-related considerations to ensure that any digital financial products developed comply with Islamic finance principles, which guide financial practices under Islamic law.
BNM noted that insights gained from the sandbox will contribute to the development of Malaysia’s broader policy framework on digital assets and tokenization. In November 2025, the central bank published a three-year roadmap outlining plans to test tokenization across multiple sectors. The roadmap includes the establishment of the Digital Asset Innovation Hub and an industry working group to gather feedback on use cases such as supply chain finance and Islamic financing solutions.
The central bank plans to conduct proof-of-concept projects and pilot studies in 2026, with a broader expansion expected in the following year. Potential applications highlighted in the roadmap include supply chain management, Shariah-compliant finance, improved access to credit, programmable finance, and round-the-clock cross-border settlements. Tokenization allows real-world assets, such as property, bonds, or commodities, to be represented digitally on blockchain networks.
In December, Ismail Ibrahim, the eldest son of Malaysia’s current king, introduced a ringgit-pegged stablecoin known as RMJDT through his telecommunications company, Bullish Aim. The token is currently being tested within a regulatory sandbox and has not been made available for public trading. During the same month, Standard Chartered Bank and Capital A also announced plans to explore ringgit-backed stablecoins designed for wholesale settlements among financial institutions, central banks, and government entities rather than for retail use.
BNM emphasized that the sandbox provides a controlled environment to test innovative digital financial products without exposing the general public to new risks. The initiative is intended to help regulators better understand the technical, operational, and legal aspects of tokenized assets while working closely with banks and private sector participants. As digital currencies and tokenized assets continue to gain global momentum, the sandbox positions Malaysia to evaluate their potential benefits and risks while adapting its regulatory framework to an evolving financial landscape.