The planned India ARC token is set to reshape the rupee-pegged digital asset landscape by aligning public debt financing with on-chain innovation.
What is India’s ARC token and when could it launch?
India’s Asset Reserve Certificate, or ARC, is a fully collateralized rupee-linked digital token developed through a collaboration between Polygon and India-based fintech firm Anq.
The project targets a tentative go-live in the first quarter of 2026, pending final regulatory and infrastructure readiness.
Each ARC token is designed to trade 1:1 with the Indian rupee. Moreover, tokens will only be minted once issuers obtain cash or cash equivalents, including fixed deposits, government securities, or cash balances.
This structure mirrors conservative reserve models and aims to ensure transparency, safety, and regulatory compliance, especially when compared with some foreign-backed stablecoins or speculative tokens.
How will the ARC maintain stability and support India’s economy?
The core design of the india arc token focuses on liquidity outflow prevention. Essentially, it seeks to keep capital and innovation within India’s domestic financial system rather than allowing flows into dollar-backed stablecoins.
At the same time, the instrument is meant to foster demand for public debt, linking digital asset growth with funding for the state.
The ARC functions as a rupee backed stablecoin but with a specific policy purpose. It is structured to channel on-chain activity into assets denominated in INR, rather than foreign currencies.
That said, it remains fully redeemable at par in line with its 1:1 design, preserving user confidence while aligning with national economic objectives.
How does ARC complement the RBI’s CBDC in a two-tier framework?
The new ARC token is conceived as a private-sector interaction layer that will sit on top of the Reserve Bank of India’s Central Bank Digital Currency. In this two tier framework, the RBI’s CBDC remains the ultimate settlement asset, safeguarding monetary sovereignty, security, and control over the monetary base.
However, the ARC platform will be operated by regulated private entities that build payment, remittance, and programmable transaction solutions within India’s financial rules. This model keeps central oversight at the base layer while allowing market-driven innovation at the application layer, similar in spirit to tiered banking systems seen in traditional finance.
How will minting and convertibility rules work for ARC?
Sources say the ARC will align with India’s long-standing regime of rupee partial convertibility. The INR today is fully convertible for current account uses such as trade, business payments, and remittances, but it remains restricted for capital account transactions. This policy aims to protect macroeconomic stability and limit speculative flows.
The stable token will support business payments without requiring full capital account convertibility. Importantly, only business account minting will be permitted.
In other words, authorised business accounts, not retail individuals, will be able to create new ARC units. This design ensures that operations stay within the boundaries of the Liberalised Remittance Scheme, which governs individual foreign exchange transactions.
What role do Uniswap v4 hooks and whitelist controls play?
On the technology side, the ARC ecosystem plans to integrate Uniswap v4 hooks to impose strict control over who can interact with the token. Moreover, swaps involving ARC will be limited to pre-approved, whitelisted addresses. This approach blends decentralised exchange infrastructure with compliance-focused access controls.
By restricting trades to vetted participants, the system is designed to operate in a regulatory-compliant environment while still leveraging open-source DeFi tooling. It also mitigates some of the risks associated with permissionless stablecoin markets, such as unmonitored cross-border flows or use by sanctioned entities.
Why is India pushing a sovereign stable asset now?
India’s sovereign-style digital asset push comes as emerging markets confront rising competition from dollar-denominated tokens. Following the Trump administration’s pro-crypto stance and the passage of the GENIUS Stablecoin Act in the United States, policymakers in New Delhi have grown more concerned about domestic liquidity leaking into foreign stablecoins.
The GENIUS Stablecoin Act text effectively legalized and standardized dollar-backed stablecoins at the federal level. According to a White House fact sheet, it requires 100% reserve backing in liquid assets and mandates monthly disclosure of reserves. However, this clarity could accelerate capital shifts away from countries like India.
Standard Chartered recently warned that emerging market banks could see deposit outflows of up to $1 trillion over the next three years as savers migrate to dollar-backed stablecoins. In that context, a domestically anchored solution such as ARC is seen as a defensive as well as an enabling tool for India’s financial architecture.
How does the Polygon Anq partnership shape ARC’s architecture?
The Polygon anq partnership brings together Ethereum scaling expertise and local regulatory knowledge. Polygon contributes infrastructure and scalability tooling, while Anq provides India-focused fintech capabilities and compliance integration. Together, they aim to deliver a token architecture that is both institution-grade and tuned to Indian regulations.
Furthermore, the token’s design explicitly positions it as an rbi cbdc complement rather than a competitor, using the central bank’s digital rupee as the base settlement layer. This alignment is expected to ease supervisory concerns and could become a template for other jurisdictions exploring public–private stable asset models.
What are the broader implications for digital finance in India?
If the ARC token launches in India as planned in Q1 2026, it could become a key piece of India’s digital finance stack. It aims to combine programmable payments, remittances, and debt market access under a regulated, rupee-linked umbrella.
That said, success will depend on adoption by banks, fintechs, and regulators, as well as on global market dynamics shaped by U.S. policy and dollar stablecoins. For now, ARC stands out as a strategic experiment in combining sovereign monetary control with on-chain innovation.
Source: https://en.cryptonomist.ch/2025/11/20/india-arc-token-launch-2026/
