India Moves Toward Launching Rupee-Backed ARC Stablecoin in 2026

India is preparing to introduce the Asset Reserve Certificate (ARC) — a rupee-pegged stablecoin set to debut in the first quarter of 2026, according to sources cited by CoinDesk. The project, first reported in local media in early November 2025, is being developed by Polygon Labs in partnership with fintech startup Anq.

The ARC will be fully backed by fiat reserves or equivalent assets such as Indian government securities (G-Secs) and treasury bills. Issuers will need to maintain adequate reserves to mint new tokens, and the asset is being positioned as non-speculative and fully regulated.

A Domestic Stablecoin Designed to Tighten Capital Controls

According to those familiar with the matter, ARC will circulate exclusively within India’s financial perimeter. Its purpose is to reduce capital flight into dollar-denominated stablecoins and strengthen domestic liquidity. By functioning as a proxy instrument tied to G-Secs, ARC may also streamline government borrowing.

The stablecoin will operate as an additional payment layer alongside India’s upcoming central bank digital currency (CBDC). While the digital rupee will serve as the primary payment instrument, ARC is intended to support cheaper, faster settlements.

The project will rely on Uniswap v4 hooks to ensure transactions occur only between authorized accounts—preserving regulatory control while enabling blockchain-based innovation. The central bank is expected to maintain full oversight of the monetary system under this model.

CBDC Timeline Remains Uncertain as ARC Nears Launch

India aims to roll out the ARC in early 2026, though the central bank has not yet disclosed a start date for issuing the digital rupee. The two-layer system—CBDC plus ARC—is intended to modernize payments while maintaining strict compliance and capital safeguards.