How does our region stand as a global hub for regulated digital assets?
The region has established itself as one of the world’s leading centres for digital assets. What distinguishes it is not simply the pace of innovation, but the recognition that digital assets need to develop within trusted financial systems if they are to achieve institutional scale and the economic growth which this transformation of financial services is bringing to the region.
The conversation has therefore moved beyond digital assets as a standalone asset class. The focus is increasingly on how the underlying technology can strengthen payments, custody, settlement and capital markets. That shift matters because the long-term value of digital assets will be determined less by speculation and more by the transformation of the operating system that supports financial services.
The Gulf is particularly well positioned because of its role in connecting trade, investment and capital flows across Asia, Africa, the Middle East and Europe. The opportunity is to combine regulated digital capabilities with established banking infrastructure so that clients can move, safeguard and deploy capital more efficiently across borders. As a super-connector, Standard Chartered sees digital assets as an additional capability through which we can strengthen cross-border connectivity and support our clients operating across multiple markets.
Are the promised potentials of tokenisation being realised in our region, rather than remaining speculative?
With Tokenisation, there is a clear end state: more liquid markets, broader distribution, faster settlement and ultimately more efficient financial market infrastructure. However, to truly achieve this, we need a holistic development of digital assets across cryptocurrencies, stablecoins, tokenised assets and new asset classes, but we also need commercial banks to be a core part of all of these to ensure a stable financial infrastructure in which tokenisation can flourish.
Tokenisation adoption remains modest at around $35bn of tokenised assets today, largely driven by equities and money market funds. SC Research anticipates this could reach $2tn by the end of 2028 but this does need the whole industry, not just the new entrants, to move together and at pace.
The traction we are seeing through platforms like Libeara, who have tokenised money market funds and tokenised gold products live in the market, VARA providing the world’s first regulatory framework for tokenised real estate, and NYSE moving to tokenised equities is promising.
The most credible use cases are those that address genuine market friction. These include the issuance and servicing of financial instruments, collateral mobility, fund administration and settlement using tokenised money. In each case, the value lies not in digitising an asset for its own sake, but in improving how it is issued, held, transferred and settled throughout its lifecycle.
That could reduce the number of disconnected systems and manual processes involved in many financial transactions. It could also make assets easier to mobilise, shorten settlement cycles and improve the use of collateral and liquidity.
Technology alone, however, will not drive adoption. Institutions need legal and regulatory certainty, commercial bank participation, interoperability, robust governance, privacy and operational resilience. The most successful applications will therefore be those that integrate with established financial infrastructure and deliver measurable value for clients. That is where tokenisation becomes significant: not as a parallel system or an experiment, but as a practical enhancement to the way markets operate.
Which regional nations currently lead the way in the development and deployment of digital assets?
The region is not developing through a single model, nor is there a single measure by which one jurisdiction can be described as the definitive leader. Leadership in digital assets is shaped by a combination of regulatory maturity, institutional participation, market infrastructure and the development of real-world use cases, with different markets demonstrating leadership across different dimensions. In particular to be a market leader the nation’s central bank, prudential, market and conduct regulators need to be deeply connected and coordinated and be working in a coordinated way to enable the significant economic benefits of digital assets whilst protecting integrity and stability.
The UAE, for example, has established itself as an important commercial hub for regulated digital asset activity, supported by dedicated regulatory frameworks and a growing ecosystem of financial institutions, technology firms and market participants. Meanwhile, Saudi Arabia has focused on the modernisation of financial market infrastructure, including initiatives exploring wholesale digital currencies and cross-border settlement; while the Kingdom of Bahrain has continued to build on its reputation for regulatory innovation, including its framework for crypto-asset services and more recent stablecoin regulations. While each market has taken a different approach, all are contributing to the region’s broader digital asset ecosystem.
As a super-connector bank, this diversity is a strength rather than a weakness. The Gulf’s role has long been to connect international trade, investment and capital flows, and the same principle applies to digital assets. The long-term opportunity lies not in which market moves first, but in building trusted, interoperable financial market infrastructure that enables institutions to operate confidently across borders. Regulators, Central Banks, Commercial Banks and Fintechs working together at pace is what will ensure the Gulf remains a leader in digital assets and that the region realises the economic benefits of this.
What are the key differentiators between stablecoins and fiat currencies?
The distinction extends beyond simple digital representation. Large-scale open blockchain networks provide a high degree of utility, portability and transferability, enabling value to move globally in near real time – much like a digital equivalent of cash. By contrast, traditional banking infrastructure remains largely account-based, operating on systems, and architecture designed prior to the internet era. Whilst most money already exists in digital form in banks and there is trust and security in the financial system that supports this, the more fundamental difference lies in the source of trust and the nature of the holder’s claim.
Fiat currency is sovereign money issued by a central bank and supported by a country’s monetary framework. Stablecoins are privately issued digital tokens designed to maintain a stable value against a reference asset, usually a fiat currency. Their credibility therefore depends on the issuer, the quality and liquidity of the reserve assets, the redemption mechanism and the regulatory framework governing them.
For our clients and other financial institutions, these are not technical details. They determine whether a stablecoin can be used confidently for payments, settlement, treasury and liquidity management. Institutional adoption requires transparency, sound governance, legal certainty and effective supervision.
This is already moving beyond theory. For example, our recently announced partnership with Circle made Standard Chartered the first Global Systemically Important Bank (G-SIB) to provide institutional clients with integrated access to USDC minting and redemption through a bank-led service. It demonstrates how regulated stablecoin capabilities can be connected to established banking infrastructure, leveraging that trust context, and used to support real institutional activity.
What practical enhancements could stablecoins offer regional economies?
The strongest case for stablecoins is not simply that they can make payments faster. It is that they can improve how money, liquidity and assets move across the entire transaction lifecycle and with higher certainty and more transparency.
For businesses operating across multiple markets, cross-border payments often involve several intermediaries, different operating hours and extensive reconciliation. Stablecoins can provide a programmable form of value that moves on digital platforms, creating the potential for more direct settlement and greater transparency over the status of a transaction.
The implications extend into treasury and working-capital management. Faster settlement can reduce the amount of liquidity that needs to be held in different locations, while greater visibility can help businesses manage cash positions more effectively. Stablecoins can also support the settlement of tokenised assets, collateral transfers and transactions in which payment and asset delivery occur together.
The value is therefore cumulative. Better settlement, improved liquidity management and reduced reconciliation can make cross-border financial workflows simpler and more efficient. For regional economies that are deeply connected to global trade and investment, these capabilities could support the movement of capital at greater speed and scale, provided they are implemented within robust regulatory and risk-management frameworks.
What are the key distinctions between CBDCs and stablecoins?
Central bank digital currencies (CBDCs) and stablecoins are both digital forms of value, but they are designed to serve different roles within the financial system.
A CBDC is sovereign money and a direct liability of the issuing central bank. A stablecoin is privately issued and typically linked to a reference asset, most commonly a fiat currency. The distinction therefore lies not only in who issues it, but also in the governance, legal framework and mechanisms that underpin trust.
That difference in design determines how each is used. CBDCs are intended to strengthen sovereign monetary infrastructure, while stablecoins are increasingly being developed to support commercial applications such as payments, settlement and treasury. Rather than competing, they address different needs within the financial system and are likely to evolve alongside one another.
At Standard Chartered, we believe the future is unlikely to be defined by one mode replacing the other. Public and private forms of digital money are more likely to coexist, each serving a distinct role. Our role as a super-connect bank is ensuing seamless interoperability across public blockchains, private blockchains, private networks and central bank infrastructure – the goal being to remove complexity and provide our clients with a seamless interoperable experience,
The future is therefore unlikely to be defined by one model replacing the other. Public and private forms of digital money are more likely to coexist, each serving a distinct role. The role of commercial banks engaging with cryptocurrencies, stablecoins, CBDC, and tokenised assets and liabilities is critical to building the new operating system for financial services in a stable and scalable system. This will deliver significant economic velocity for the Gulf as Central Banks, Regulators, Commercial Banks and Fintechs are working together and at pace.
