Malaysia’s central bank, officially known as Bank Negara Malaysia (BNM), published a working paper that explores the possibility of Bitcoin and XRP serving as future monetary alternatives.
As the world is currently pushing toward a pro-crypto stance, the Southeast Asian country, Malaysia, also took the initiative to shape its traditional infrastructure. The country is planning to innovate the traditional banking system by allowing digital assets as an alternative.
The BNM published a paper in July that explicitly stated, “Private tokens such as Bitcoin or XRP may be widely used as means of payment outside the banking system in the future, replacing CIC or bank deposits.”
However, this may only be implemented after fulfilling the requirements. BNB said, “It is argued that these private decentralised tokens must overcome large obstacles to be able to complement or replace the current payment system.”
“Hence, cryptoassets may exist outside the regulated banking system, but not necessarily in a decentralised manner,” it added.
While the central bank is allowing for crypto utility as a payment tool, it is also imposing some conditions to mitigate risks. To execute the new initiative, it is crucial for the BNM to provide regulatory clarity and consumer protection to prevent any associated risks.
The bank said it also needs to build a robust technological system that can handle high transaction volume. The regulators must address price volatility before initiating for large crypto adoption via the new payment system.
In 2025, crypto has rapidly surged in terms of price, supply, regulations, clarity, and adoption. Many large industries and major countries have integrated crypto into their standard ecosystem of finance. Now, Malaysia has taken a pivotal stance that proves its openness to crypto. This forward-thinking initiative with Bitcoin and XRP can inspire other nations to conduct similar studies.
Malaysia’s central bank (BNM) is exploring crypto payments but requires regulatory frameworks, price stability solutions, and technological upgrades before implementation.
BNM requires: 1) Price stability mechanisms 2) Robust transaction systems 3) Clear regulations 4) Consumer protections before crypto payment integration.
BNM highlighted these assets due to their established networks – Bitcoin as digital gold and XRP for cross-border payments – though final implementation may include other cryptos.
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