India is taking another step towards bringing blockchain technology into mainstream financial markets. Reportedly, the country is preparing for its first tokenised corporate bond release, marking a significant milestone in the adoption of distributed ledger technology (DLT) within regulated financial infrastructure. The initiative comes as Indian regulators explore how tokenisation can make financial markets more efficient, transparent, and accessible. While the initial pilot is limited in scope, it could provide valuable insights into how traditional financial instruments can evolve in a digitally-native financial ecosystem.
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What We Know About India’s Tokenised Bond Pilot
Based on reports, REC Ltd., a state-managed company, is expected to be the first issuer under the pilot, with the proposed issuance likely to include:
- First Tokenised Corporate Bond: The company is anticipated to issue a tokenised corporate bond worth less than Rs. 500 crore, making it a limited product rather than a large-scale product launch.
- Expected Timeline: The issuance is planned for September 2026, although the timeline hasn’t been formally announced by the REC or the regulators.
- Blockchain-Based Ownership: The securities would be recorded using DLT, allowing ownership of the tokenised bonds to be maintained digitally.
- Wholesale CBDC Settlement: Investors are expected to use India’s wholesale central bank digital currency (CBDC) to settle the obtaining of the tokenised securities.
- Digital Securities Wallet: The pilot is understood to make use of a new securities wallet, referred to as “DEMAT 2.0,” to record ownership of the tokenised bonds.
- Limited Investor Participation: The initial issuance is expected to be restricted to a specific set of investors, with regulators analysing the model in action.
- Potential Secondary Market: Exchanges are understood to develop a secondary market, for the tokenised bonds, later in 2026.
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Final Thoughts
The significance of the initiative extends beyond the first issuance itself. It represents an opportunity to test how India’s financial infrastructure can adapt to a more digitally-native model, while maintaining the safeguards expected of a regulated market. If the pilot demonstrates meaningful benefits, it could encourage further experimentation across India’s capital markets and create a stronger foundation for the digitalisation of financial assets. More broadly, the development highlights how blockchain is increasingly being explored not only for digital assets, but also as infrastructure for the future of traditional finance.
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