Bank Negara Malaysia (BNM), the nation’s central bank, has launched an expanded digital asset regulatory sandbox under its Digital Asset Innovation Hub (DAIH) to pilot stablecoins and tokenized financial products.
The program would enable the bank to explore how the digital equivalent of the Malaysian ringgit and other tokenized financial products could operate in the real world.
Bank Negara Malaysia said the sandbox would focus on ringgit-backed stablecoins, digital tokens that maintain a fixed value tied to the Malaysian currency, as well as tokenized bank deposits.
These experiments will inform the bank on how these types of digital assets could enable faster cross-border payments and, perhaps, inform the creation of a central bank digital currency (CBDC).
“The testing will allow BNM to assess the implications for monetary and financial stability and inform our policy direction in these specified areas. Notably, BNM intends to provide greater clarity on the use of ringgit stablecoins and tokenised deposits by the end of 2026,” part of the statement read.
A CBDC is a form of money created and held in circulation by a central bank through digital means. Several of the world’s biggest banks have joined the trials. Standard Chartered Bank, CIMB Group Holding, Maybank, and investment company Capital A are also among the banks’ plans to assess Shariah-related considerations, which are rules from Islamic law that guide financial practices and must be maintained in compliance with Islamic finance products.
According to BNM, lessons learned from the sandbox programs will help shape the country’s policy around digital assets and tokenization. Globally, governments are racing to explore digital currencies and tokenized assets to keep pace with the growing digital economy.
Malaysia tests Shariah-compliant tokenization as stablecoin pilots expand
In November 2025, Bank Negara Malaysia published a three-year roadmap for testing tokenization across several sectors. As previously reported by Cryptopolitan, it is establishing a Digital Asset Innovation Hub and an industry working group to solicit feedback on use cases, including supply chain finance and Islamic financing solutions.
The central bank stated in their report that it plans to conduct proofs of concepts and pilot studies in 2026 and then expand the scope the following year. The roadmap highlights potential uses in supply chain management, Shariah-compliant finance, access to credit, programmable finance, and round-the-clock cross-border settlements.
Malaysia’s central bank will also assess “Shariah-related considerations,” which refers to the Islamic code of law governing social, financial, and political customs. Tokenization allows real-world assets, such as property, bonds, or commodities, to be represented digitally on a blockchain.
A significant event took place in December, when Ismail Ibrahim, the eldest son of Malaysia’s current king, introduced a ringgit-pegged stablecoin called RMJDT. The token, issued by Ibrahim’s telecom company, Bullish Aim, is also being tested in a sandbox and has not been used in public trades.
The same month, Standard Chartered Bank and Capital A unveiled plans of their own to study ringgit-backed stablecoins for wholesale settlement. These stablecoins are built for large-scale transactions among financial institutions, central banks, and governments, not for everyday retail use.
BNM tests tokenized finance in controlled sandbox
BNM’s sandbox provides a protected environment to test new digital financial products and does not introduce new risks to the general public. They aim to educate regulators on the technical, operational, and legal nuances of tokenized assets with help from banks and private companies.
The approach also highlights how tokenized bank deposits could function, such as through automated cross-border settlements and interfacing with programmable financial contracts.
As tokenized assets and digital currencies continue to grow in importance, BNM’s sandbox positions Malaysia to explore the potential benefits of these technologies and adapt its regulations to a rapidly changing financial landscape.
Source: https://www.cryptopolitan.com/malaysias-bank-launches-digital-sandbox/
