BLOOM and the expansion of stablecoins in Southeast Asia

A regional alliance for digital payments

On October 23, 2026, Bank Negara Malaysia and the Bank of Thailand joined the public-private BLOOM initiative, launched by the Monetary Authority of Singapore (MAS) in October 2025. In their capacity as policy members of the initiative, the two central banks are taking part in the governance of a project whose objective is to make it simpler to use both stablecoins and tokenized deposits when making payments across national borders. This decision to join marks the first occasion on which three jurisdictions in Southeast Asia have united around a shared framework for digital money used between banks.

BLOOM, an acronym for Borderless, Liquid, Open, Online, Multi-currency, aims to reduce operating costs by eliminating the need for each financial institution to negotiate separate agreements with every counterparty. According to MAS, the consortium would enable banks to launch new services more quickly, particularly in corporate treasury management, trade finance and payments automated by artificial intelligence agents. Private participants include major organizations such as Airwallex, Mastercard, Ripple, Visa and the World Bank.

Stablecoins: peg principles and reserves

Stablecoins such as Circle’s USDC and Tether’s USDT are designed to maintain a value close to one US dollar. This target peg relies on asset reserves managed by issuers, whose composition and disclosure frequency vary. Circle, for example, details the cash and cash-like assets backing USDC, while Tether publishes similar attestations. However, simply displaying a one-dollar price does not guarantee immediate, free conversion accessible to everyone, because direct redemption depends on access conditions, checks and sometimes fees.

Making a transfer of a stablecoin from one wallet to another wallet does not require any intervention on the part of the issuer, but creating new units, destroying them or converting them into fiat money are separate operations. Understanding this distinction is essential if users are to differentiate between the quantity of tokens that are in circulation, the volume of trades taking place and the options available to convert out of those tokens and into a local currency. Associated risks include reserve quality, technical intermediaries such as blockchain bridges and exchange-rate movements between the dollar and other currencies.

Implications for cross-border payments

By integrating stablecoins into their infrastructure, the region’s central banks seek to offer alternatives to traditional payment systems, which are often slower and more expensive. BLOOM notably envisages using tokenized deposits for large-value payments between businesses, which could shorten settlement times from several days to a few minutes. Artificial intelligence agents, operating within predefined limits, could automate these transactions while complying with local regulatory requirements.

However, token stability alone does not guarantee safe settlement. The participants involved must evaluate how sound the reserves are, how transparent the issuers are about their operations, and how robust the blockchain networks on which these payments take place actually are. Exchanges, cross-chain bridges and smart contracts introduce additional points of failure. Thus, even if a stablecoin’s peg remains close to its reference unit, users must remain alert to fees, available liquidity and the redemption conditions imposed by each participant.