In a groundbreaking move for the Islamic finance sector, Fasset, a digital asset investment platform, has secured a provisional banking license in Malaysia. This milestone paves the way for what Fasset claims to be the world’s first stablecoin-powered Islamic digital bank, marking a significant leap in the integration of fintech innovations with traditional Islamic banking principles.
The Journey to a Revolutionary Banking Model
Fasset’s newly acquired license places it within Malaysia’s regulated sandbox for Islamic fintech. This strategic positioning allows the company to transition from its existing digital asset platform to a full-service banking operation. The sandbox environment is designed to foster innovation while ensuring compliance with financial regulations, particularly those aligned with Islamic law.
CEO Mohammad Raafi Hossain expressed enthusiasm about the development, emphasizing how the license amalgamates “the credibility of a global banking institution with the innovation of a fintech insurgent.” This dual focus is integral for Fasset as it seeks to offer a suite of Shariah-compliant financial services, including savings, financing, and investment options that leverage stablecoins and tokenized assets.
Breaking New Ground with Stablecoin Infrastructure
A key feature of Fasset’s offering is its stablecoin infrastructure, which is designed to sidestep interest-bearing products—a necessity given that Shariah law prohibits all forms of interest, known as riba. By utilizing stablecoins, Fasset aims to protect users’ assets from inflation and currency volatility, a common concern in many Muslim-majority regions.
The platform’s upcoming services promise to broaden financial accessibility for its users, allowing them to maintain deposits, invest in U.S. stocks, gold, and cryptocurrency. Additionally, a planned Visa-linked crypto card will enable users to spend their digital assets with ease, bridging the gap between traditional and digital currencies.
An Ambitious Vision for Financial Inclusion
Fasset’s move into Islamic digital banking is not just about innovation but also about addressing a persistent gap in financial inclusion within the $5 trillion global Islamic finance industry. Many Muslim-majority areas, particularly in Asia and Africa, still lack access to halal, asset-backed financial products. By creating a stablecoin-powered Islamic digital bank, Fasset hopes to provide these underserved markets with equitable financial solutions.
The company’s ambitions are underscored by its previous achievements, such as obtaining a license to operate in Dubai as a Virtual Asset Service Provider (VASP) in March of last year. Fasset has already demonstrated significant capability, with its platform processing over $6 billion in annualized transaction volume across 125 countries.
The Role of Technology in Islamic Finance
Technology plays a pivotal role in Fasset’s vision. The company plans to introduce “Own,” an Ethereum Layer 2 network built on Arbitrum, designed to facilitate the on-chain settlement of regulated real-world assets. This initiative underscores Fasset’s commitment to leveraging cutting-edge technology to meet the unique needs of Islamic finance.
The integration of blockchain technology not only provides transparency and efficiency but also aligns with Islamic finance principles, which emphasize risk-sharing and asset-backed investments. By settling transactions on-chain, Fasset aims to enhance trust and security for its users, further solidifying its position as a leader in Islamic fintech.
Balancing Innovation with Tradition
While Fasset’s initiative represents a significant step forward, it also raises questions about the balance between innovation and tradition. The use of stablecoins and blockchain within an Islamic banking context is uncharted territory, and the success of Fasset’s model will likely influence future developments in the sector.
Critics may argue that the integration of such technologies could pose challenges in maintaining strict adherence to Shariah principles. However, Fasset appears committed to navigating these complexities, emphasizing the importance of regulatory compliance and Shariah certification in all its offerings.
Looking Ahead
Fasset’s entry into the Malaysian market with its stablecoin-powered Islamic digital bank is poised to set a new precedent in the fintech industry. By blending modern financial technology with the foundational principles of Islamic finance, Fasset is not only expanding its own horizons but also paving the way for a more inclusive and accessible financial future for Muslim communities worldwide.
As the fintech landscape continues to evolve, Fasset’s pioneering efforts could serve as a model for other companies seeking to harness the potential of digital assets while respecting cultural and religious values. The success of this venture will be closely watched, as it holds the promise of transforming the Islamic finance sector and beyond.
Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
