India is setting its sights on tokenizing $627 billion worth of corporate bonds. The country's securities regulator, SEBI, has announced the successful launch of its Demat 2.0 pilot—an initiative that transforms corporate bonds into digital tokens on a distributed ledger and links settlements to India's wholesale digital rupee.

What Is Demat 2.0?

Demat 2.0 is a new infrastructure where bonds are issued and traded as digital tokens on DLT (distributed ledger technology). Settlements for these tokenized instruments are integrated with the wholesale digital rupee, syncing up issuance, trading, and redemption in a single tech stack.

Pilot Results

In the pilot phase, three companies have already issued tokenized bonds totaling 10.25 billion rupees (about $115 million). SEBI says the pilot program is up and running, with both issuance and settlement mechanisms working as planned.

The Scale of the Initiative

The plan is to eventually tokenize up to $627 billion in corporate bonds. This pilot shows that distributed ledger tech and the wholesale digital rupee can work for debt instruments at a national scale in India.