Bank Negara Malaysia (BNM) has launched a three-year study into real-world asset tokenization. It has established a digital asset innovation hub and an industry working group to solicit feedback on use cases such as supply chain finance and Islamic finance solutions.
The central bank said in a report that it plans to conduct a proof-of-concept and pilot study in 2026 and expand the scope the following year. Test parameters are clearly outlined and ideas from industry representatives must be submitted by March 1, 2026.
BNM sought feedback from financial companies, fintechs and technology partners
The bank is defined An analytical framework for evaluating use cases with three guidelines. Tokenization will not be evaluated unless it is shown to create value in the activity rather than as a result of assumptions.
Furthermore, DLT should only be used when it creates clear value, rather than as an independent evaluation of the technology. Many problems can be better solved using APIs.
Finally, the feasibility of any tokenization case is limited by current technical and functional capabilities, but will expand as the industry’s understanding of these technologies increases.
Bank Negara Malaysia works with financial institutions, fintech startups and technology partners to identify use cases that have the potential to generate tangible economic benefits. Similar experiments are underway among regional regulators.
First, Singapore’s Project Guardian has expanded to include more than 40 financial institutions running tokenized asset pilots, and Hong Kong’s Project Ensemble is building wholesale payments infrastructure to enable tokenized transactions.
BNM’s tokenization efforts could expand to other assets
Tokenization is currently a growing phenomenon that has the potential to revolutionize financial markets around the world. Tokenization is the process of converting physical or traditional financial instruments into digital tokens on a blockchain, enabling faster, more efficient, and lower-cost transaction execution with complete control and transparency. Malaysia could take advantage of such options to strengthen its foothold in the region’s digital financial environment.
Bank Negara Malaysia is exploring the potential of tokenization to facilitate continuous and real-time trade and international payments. As cross-border transactions become increasingly digital, these efforts could complement projects such as Dunbar and Guardian and help integrate Malaysia into broader regional payments frameworks.
Financial products are central to BNM’s immediate focus. The first batch of applications will cover traditional assets such as bonds, loans and deposits, after which the agency will expand into more complex areas.
Nevertheless, Bank Negara Malaysia’s lead researcher believes that assets such as real estate certificates and machinery could also be tokenized in the future. This initiative is currently open only to authorized and regulated financial institutions, allowing us to maintain stable governance and accountability standards over time.
As the bank strengthens its infrastructure, it intends to evolve from a mixed on-chain/off-chain system to a fully digital solution and maintain the flexibility of its tokenization architecture. It is also possible to accept tokenized deposits and stablecoins denominated in MYR.
Meanwhile, regulators are sounding the alarm as the global crypto industry races to leverage tokenized products, including stock-linked crypto products. They argue that fast-growing new products pose risks to investors and market stability.
Buoyed by President Donald Trump’s pro-crypto stance and his administration’s efforts to promote friendly regulation, the crypto industry is looking to capitalize on growing global enthusiasm for the sector.
Sign up to Bybit and start trading with a $30,050 welcome gift