India’s new ARC stablecoin : India is avout to achieve a major milestone in its financial and digital strategy through a new partnership with Polygon and Anq. The country is preparing to launch a stablecoin backed by national debt, called the Asset Reserve Certificate (ARC). Scheduled for release in early 2026, the project aims to strengthen India’s monetary sovereignty, support demand for government bonds, and reduce its growing reliance on dollar-backed stablecoin.
India’s new ARC stablecoin : reducing dollar dependency
The global stablecoin market is dominated by dollar-backed tokens. This situation concerns many governments, including India, as it stimulates capital outflows toward digital foreign assets. By developing a government-bond-backed stablecoin, India aims to :
- Reduce the influence of the U.S. dollar within its financial ecosystem
- Create a new financial instrument to support and strengthen its public debt
- Reinforce control over cash movements and digital financial flows
- Offer a compliant, stable, and domestically backed alternative to foreign stablecoins
India’s new ARC stablecoin : key actors of India’s finetech
The development of the ARC stablecoin brings together key actors from India’s fintech and blockchain sectors. Among them are several companies specializing in blockchain infrastructure, working alongside local financial institutions to create tokens that comply with national regulations and are secured by sovereign assets. Each token will be issued only in exchange for Indian government bonds, ensuring genuine and transparent collateralization.
A two layer model
The ARC model relies of an innovative hybrid system :
- Niveau 1 : la monnaie numérique de banque centrale (MNBC), Elle fournit une couche d’infrastructure et garantit un contrôle institutionnel solide.
- Niveau 2 : le stablecoin ARC, Il fonctionne sur la blockchain, est programmable, flexible, et conçu pour des transactions rapides et peu coûteuses.
This two-layer model is sometimes described as a ‘twin-rupee’: a combination of a central bank digital currency and a national-debt-backed token. Among the many usage conditions :
- Only licensed professional entities will be allowed to issue or exchange ARC.
- Transactions will be restricted to verified addresses, ensuring strict compliance.
- Each ARC token will correspond to a real sovereign asset, providing strong stability and minimizing risk.
India’s new ARC stablecoin : what does the project aim for
- Support national debt: Creating a government-bond-backed stablecoin could boost demand for Indian bonds and open a new lever for national financing.
- Reduce dollar dependency: By offering a credible local alternative, India aims to slow the dominance of USD-backed stablecoins within its crypto ecosystem.
- Accelerate compliant blockchain adoption: ARC will serve as a bridge between traditional finance and blockchain, enabling a controlled and compliant adoption of DeFi technologies.
Calendar and perspectives
The ARC stablecoin may be launched in the first quarter of 2026. If the project proves successful, it could :
- Open the door to broader tokenization of India’s sovereign assets
- Inspire other countries to develop their own public-debt-backed stablecoins
- Strengthen India’s influence within the global digital currency landscape
India’s new ARC stablecoin : risks and limits
- Strict regulation: Strong oversight from the central bank could limit innovation.
- Limited adoption: A system restricted to professional actors may reduce broader public use.
- Impact on the bond market: Excessively concentrated demand could disrupt sovereign bond liquidity.
Conclusion
The ARC stablecoin represents a bold and strategic initiative for India. By backing a digital asset with its own public debt, the country aims to strengthen its monetary sovereignty, modernize its financial instruments, and reduce the dominance of the U.S. dollar in the crypto sphere. 2026 could mark a major milestone, introducing a model that other nations may replicate in pursuit of stable monetary innovation.
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