Standard Chartered Bank Malaysia and Capital A, the parent company of AirAsia, plan to jointly develop stablecoin, pegged to the local currency of Malaysia, the ringgit.
The bank’s Malaysian arm and Capital A are reported to have signed a memorandum of understanding to develop a ringgit-pegged stablecoin as part of the country’s Digital Asset Innovation Hub, an initiative announced by Bank Negara Malaysia (BNM) in June.
The initiative will leverage Standard Chartered’s infrastructure and financial expertise, as well as Capital A’s ecosystem, to launch the stablecoin in the wholesale market rather than the retail market.
The bank’s Malaysian subsidiary will act as the stablecoin issuer, while Capital A and its ecosystem companies will develop, test, and pilot use cases for wholesale buyers.
Malaysia is striving to keep up with other countries integrating cryptocurrency and stablecoins into the mainstream financial system. The eldest son of Malaysia’s billionaire king recently launched a digital asset pegged to the national currency. And the country’s Digital Asset Innovation Centre allows fintech and digital asset companies to test new technologies under the supervision of Bank Malaysia.