India Launches Tokenized Corporate Bond Pilot with Blockchain-Backed Digital Rupee

India is set to launch its first tokenized corporate bonds next month, as part of a pilot project developed in collaboration with the Reserve Bank of India and the Securities and Exchange Board of India. The bonds, worth less than 5 billion rupees (approximately $57 million), will be issued by state-owned power financier REC and settled through blockchain-based infrastructure using the wholesale digital rupee.

The test aims to demonstrate whether distributed-ledger technology can streamline the process of issuing, recording, and settling corporate debt. Initially, access will be restricted to a limited group of investors as regulators test the system.

Participants in the pilot will need two digital accounts: a wholesale central bank digital currency wallet supplied by a bank, and a securities wallet built by India's depositories under DEMAT 2.0, which records tokenized bond holdings on a distributed ledger.