4 hours ago
2
Fasset, a Middle Eastern digital asset investment company, has obtained a license to launch an Islamic digital bank, powered by stablecoins.
Elsewhere, American banking giant BNY Mellon (NASDAQ: DMF) is exploring the use of tokenized deposits in its $2.5 trillion-a-day funds transfer business, enabling its clients to move money instantly, 24/7.
Stablecoin-based Islamic digital bank
Fasset recently announced that it had acquired the license from the Labuan Financial Services Authority in Malaysia, the financial watchdog for Labuan IBFC, a special offshore financial zone that targets international businesses dealing in banking, insurance, investment, and digital assets.
The license allows the company to offer digital banking services to its users; Fasset says it will use the license to launch the world’s first Islamic digital bank powered by stablecoin infrastructure.
The Dubai-based company claims to have a global userbase of 500,000 across 125 countries. Last year, it recorded over $6 billion in transaction volume and targets $26 billion next year.
It now aims to become a gateway to financial inclusion for Asia and Africa, similar to what NuBank did for Latin America.
“We’ve been told for years what’s ‘impossible’: that Islamic finance can’t go global, that banks can’t be built on crypto, that financial freedom isn’t for emerging markets. We’re here to prove otherwise,” commented CEO Mohammad Hossain.
In line with its Shariah law compliance, Fasset claims its stablecoin-powered system will enable its users to avoid interest-bearing financial products. Shariah prohibits financial institutions from charging interest, opting for models that share the risk between the banks and the customers.
In addition to avoiding interest, stablecoins will also enable Fasset users to preserve their assets’ value against depreciation and currency volatility.
Beyond the stablecoin rails, the company intends to launch an Ethereum layer 2 network, to be named “Own,” to settle real-world assets (RWAs) on-chain. It will also offer a “crypto” debit card.
“We can now combine the credibility of a global banking institution with the innovation of a fintech insurgent that’s fully halal. We’re on track for over $24B in volume by year-end 2026 and expect much of that to stay within our Fasset ecosystem, driving strong assets under management and opening the door to new banking services in the future,” Hossain added.
Digital banks have grown massively in recent years. Just weeks ago, ZA Bank became the first digital-only bank to hit a million users in Hong Kong. Earlier this month, the United Arab Emirates’ digital-first lender, Wio Bank, hit Dh50 billion ($13.6 billion) in deposits, less than three years after launch.
BNY Mellon targets $2.5 trillion market with tokenized deposits
Meanwhile, American banking giant BNY Mellon is weighing tokenized deposits for its $2.5 trillion daily payment settlement market.
In an interview with Bloomberg, Carl Slabicki, who heads treasury services at the bank, revealed that it’s working on modernizing its settlement infrastructure as competition ramps up from fellow Wall Street titans and fintechs. One of the key areas of focus is implementing real-time payments and instant cross-border transfers.
Tokenized deposits have emerged as one of the best solutions for BNY Mellon, Slabicki revealed. They can enable the bank to “overcome legacy technology constraints, making it easier to move deposits and payments across their own ecosystems – and eventually, across the broader market as standards mature.”
BNY is the largest custodian in the United States, managing nearly $56 trillion in assets under custody and/or administration, with over $16 trillion in average daily clearance value last year.
BNY joins other banking giants, including JPMorgan (NASDAQ: JPM), HSBC (NASDAQ: HSBC), and Deutsche Bank (NASDAQ: DB), in turning to tokenized deposits for instant settlements.
This week, Citigroup (NASDAQ: C) CEO Jane Fraser backed tokenized deposits as the future of finance. She noted that while stablecoins have grabbed the headlines amid rapid growth and positive regulations, they are unlikely to underpin the global financial market infrastructure.
“What our clients want is interoperable, multi-bank, always-on payment solutions provided in a safe and sound manner. That is best done by tokenized deposits,” she stated.
She added that tokenization will grow beyond payments and believes that every asset will be tokenized and traded on-chain.
Watch | Spotlight On: Centi Franc—the truly stable stablecoin
English (US) · 