Malaysia’s central bank has unveiled a three-year roadmap for the tokenization of assets within its financial system. The Bank Negara Malaysia (BNM) will utilize its Digital Asset Innovation Hub (DAIH) to conduct pilot programs across various sectors, including supply chain financing and Islamic finance automation. The program aims to increase efficiency and transparency in traditional financial operations. BNM has identified several initial applications, including leveraging tokenized financial instruments for faster settlement between institutions, improving SME access through tokenized supply chain financing, and automating Islamic contracts for compliance with Shariah regulations. The initiative focuses on real-world assets rather than cryptocurrencies and seeks to test the integration of wholesale central bank digital currency (CBDC) for interbank payments. The roadmap also includes plans to introduce MYR-denominated tokenized deposits and stablecoins to ensure their alignment with the ‘singleness of money.’ A working group comprising banks, fintech firms, and market infrastructure providers will coordinate technical testing and provide feedback on regulatory and legal barriers before 2026. This initiative comes at a time when other regional regulators like Singapore’s Monetary Authority (MAS) are also exploring tokenization programs for bonds and funds. The BNM aims to prioritize use cases that can deliver tangible benefits such as cost savings or enhanced access to capital for Malaysian businesses through pilot testing.