India pilots blockchain settlement for corporate bonds
Regulation & Gov ·
SEBI and the Reserve Bank of India have begun testing tokenized corporate bonds on distributed ledger technology as part of a program called Demat 2.0.
The pilot, reported by WuBlockchain, lets securities and payments settle simultaneously on-chain by pairing tokenized bonds with the RBI's wholesale digital rupee. That atomic settlement mechanism is meant to remove the lag between a bond trade and its cash payment, a gap that currently exists in India's conventional clearing process.
Three issuers have already tested the system. REC, L&T and IIFL have together issued ₹10.25 billion, or about $116 million, in bonds under the pilot, according to coverage from CoinDesk. The figure is small relative to the market it targets: India's corporate debt market is valued at roughly $620 billion, and Demat 2.0 is framed as an early step toward modernizing that market's infrastructure.
The involvement of both the securities regulator and the central bank signals a coordinated approach rather than a single-agency experiment. SEBI oversees the tokenization and issuance side, while the RBI supplies the digital rupee used for settlement, tying the pilot directly to India's existing central bank digital currency work. Additional context on the rollout situates the pilot within India's wider effort to bring blockchain infrastructure into mainstream capital markets.
At this stage, the pilot remains limited to the three named issuers and a combined issuance far short of the broader market's scale. It is not yet clear how or when SEBI and the RBI intend to expand participation beyond REC, L&T and IIFL, or what benchmarks would determine whether Demat 2.0 moves from pilot to standard practice. Two sources have corroborated the launch and its initial figures, but details on timeline, additional issuers, and eventual market-wide adoption have not been disclosed.