- India’s ARC stablecoin is being developed in collaboration with Polygon and Anq, with a planned launch in early 2026.
- Tokens will be minted only for fully collateralized commercial accounts.
- The stablecoin will operate in tandem with the RBI’s CBDC to preserve domestic liquidity and enable faster payments.
The Asset Reserve Certificate (ARC) stablecoin is a fully backed rupee-pegged digital currency being developed for India, expected to debut in the first quarter of 2026. The project is a collaboration between Ethereum scaling leader Polygon Labs and Bangalore-based fintech firm Anq.
Designed to modernize India’s payment infrastructure, the ARC stablecoin aims to retain domestic liquidity while strengthening demand for government debt instruments.
ARC stablecoin and the Reserve Bank of India’s CBDC
The ARC stablecoin is designed to run alongside the Reserve Bank of India’s central bank digital currency (CBDC), offering a regulated private-sector layer while the RBI’s CBDC functions as the ultimate settlement asset.
This two-tier approach enables faster, lower-cost payments and programmable transactions without compromising monetary sovereignty or regulatory oversight.
By combining blockchain innovation with local fintech expertise, the project seeks to bridge traditional banking systems and decentralized technologies.
ARC will be fully collateralized and pegged 1:1 to the Indian rupee. Tokens will only be minted when sufficient reserves exist in cash, government securities, or term deposits.
Issuers of ARC will operate through authorized commercial accounts that comply with Liberalised Remittance Scheme (LRS) rules and certain partial convertibility guidelines.
Trading will also be restricted to whitelisted addresses connected via hooks on the Uniswap v4 protocol, ensuring the stablecoin remains secure, compliant, and fully traceable within India’s financial ecosystem.
Preserving domestic liquidity
A primary goal behind ARC is to limit capital flows toward dollar-backed stablecoins, which have drawn increasing attention in emerging markets following regulatory shifts in the United States.
Indian authorities have voiced concern that rising demand for global stablecoins such as USDT and USDC could pull liquidity out of the domestic market, potentially destabilizing local banks and slowing government borrowing.
By pegging ARC to the rupee and implementing robust compliance measures, India aims to retain financial innovation and liquidity domestically while supporting demand for government securities.
The stablecoin also intends to address operational inefficiencies in current payment systems. ARC transactions promise near-instant settlement, reduced reconciliation delays, and lower processing costs for high-volume corporate activity.
If successful, the ARC stablecoin could build confidence in rupee-denominated digital assets, provide a local alternative to global stablecoins, and bolster India’s position in the broader digital economy.
Strategic timing and market impact
The timing of ARC’s launch is strategic, arriving as countries worldwide explore regulated stablecoins to accelerate cross-border payments and improve liquidity.
India plans to leverage Polygon’s Ethereum-based infrastructure alongside Anq’s domestic expertise to create a scalable, compliant platform capable of integrating with existing systems such as UPI and the Polygon CDK network.
Local crypto community experts have praised the initiative as potentially transformative, likely to reduce capital outflows during periods of market stress and strengthen the national digital finance ecosystem.
Nevertheless, ARC’s success will depend on adoption by banks, fintech firms, and regulators, and on its ability to complement the RBI’s CBDC effectively.