- Indian stablecoin ARC, developed in partnership with Polygon and Anq, is scheduled to launch in early 2026.
- Tokens will be minted only for corporate accounts with full collateral.
- The stablecoin will operate alongside the RBI CBDC to maintain liquidity and enable faster payments.
The Indian stablecoin Asset Reserve Certificate (ARC), a fully collateralized rupee stablecoin slated to debut in the first quarter of 2026, is being developed through a partnership between Ethereum-scaling giant Polygon Labs and Bengaluru-based fintech firm Anq.
The stablecoin aims to modernize India’s payments landscape while keeping financial flows within the country and boosting demand for government debt instruments.
ARC stablecoin and India’s central bank digital currency (CBDC)
ARC is designed to operate alongside India’s central bank digital currency (CBDC), providing a regulated private-sector layer while the RBI CBDC serves as the ultimate settlement instrument.
This two-tier framework enables ARC to facilitate faster, cheaper payments and programmable transactions without compromising monetary sovereignty or regulatory oversight.
By combining blockchain innovation with fintech expertise focused on India, the project aims to bridge the gap between traditional banking systems and decentralized technologies.
ARC will be fully backed and pegged 1:1 to the Indian rupee, and tokens will be minted only when adequate reserves are held in cash, government securities, or term deposits.
Issuers of ARC will be authorized exclusively for corporate accounts, in line with the Liberalized Remittance Scheme (LRS) rules and partial convertibility guidelines.
Transactions will also be restricted to whitelisted addresses through protocol hooks such as Uniswap v4, ensuring the stablecoin remains secure, compliant, and fully traceable within India’s financial ecosystem.
Keeping liquidity at home
One of ARC’s primary motivations is to limit capital outflows to dollar-backed stablecoins that have gained traction in emerging markets following regulatory shifts in the United States.
Indian authorities have voiced concerns that growing demand for global stablecoins like USDT and USDC could divert liquidity away from domestic markets, potentially destabilizing local banks and slowing government borrowing.
By anchoring ARC to the rupee and pairing it with robust compliance mechanisms, India seeks to retain financial innovation and liquidity within its borders while also supporting demand for sovereign debt.
The stablecoin also aims to address operational inefficiencies in existing payment systems. ARC transactions promise near-instant settlement, reducing settlement delays and lowering costs for businesses that handle high transaction volumes.
If successful, ARC could help build trust in rupee-based digital assets, offer a local alternative to global stablecoins, and strengthen India’s position in the broader digital economy.
Strategic timing and market impact
The timing of ARC’s introduction is strategic, arriving as countries worldwide explore regulated stablecoins to accelerate cross-border payments and improve liquidity.
Leveraging Polygon’s Ethereum infrastructure together with Anq’s domestic expertise, India hopes to create a scalable, interoperable platform that can integrate with existing systems such as UPI and Polygon CDK.
Members of the local crypto community have already called the development a potentially transformative step that could reduce capital flight during market upswings and bolster the country’s digital financial ecosystem.
However, ARC’s success will depend on adoption by banks, fintech firms, and regulators, as well as its ability to complement the RBI CBDC.