India to Launch Rupee-Pegged ARC Stablecoin in 2026

India is set to launch a new rupee-pegged stablecoin called the Asset Reserve Certificate, or ARC, in the first quarter of 2026, in a move designed to bolster domestic financial liquidity and innovation while complementing the central bank's digital currency.

Developed through a partnership between blockchain infrastructure provider Polygon and Bengaluru-based fintech firm Anq, the ARC will be fully collateralized and backed one-to-one by Indian rupee assets, including cash, government securities, treasury bills, and fixed deposits. Tokens will be minted exclusively for authorized business and institutional accounts, aligning with India's foreign exchange regulations such as the Liberalised Remittance Scheme and the partial convertibility of the rupee. This restriction aims to ensure compliance and prevent unauthorized capital flows.

The stablecoin will operate within a two-tier framework alongside the Reserve Bank of India's central bank digital currency, known as the digital rupee. In this structure, the ARC serves as a private-sector layer for programmable transactions and business payments, while the RBI's digital rupee acts as the primary settlement instrument. This setup...