India Issues $116M in Tokenized Corporate Bonds via Demat 2.0 Pilot

India has taken another significant step in its journey to adopt blockchain and digital assets. The country's Securities and Exchange Board (SEBI) announced that it had issued $116 million in tokenized corporate bonds using the Demat 2.0 pilot. This innovative platform connects a distributed ledger owned by India's statutory depositories with the Reserve Bank of India's Unified Market Interface, allowing for atomic settlements.

The first issuance was completed on September 7 by REC Limited, which raised $50 million from 18 investors. Larsen & Toubro followed suit on September 9, issuing another $50 million in bonds. IIFL issued a smaller bond of $2.5 million later the same day.

The Demat 2.0 pilot is expected to reduce manual file sharing and reconciliation work, allowing issuers to receive payment on the bidding day itself. The platform also streamlines delivery services, enabling interest payments and bond redemptions to be programmed and delivered directly into an investor's digital rupee wallet.

SEBI expects the pilot to focus on corporate bond issuance in its first phase, with plans to connect tokenized bonds with existing request-for-quote platforms. This would allow eligible investors to buy and sell securities after issuance, keeping trading within the regulated market structure.