Market regulator Securities and Exchange Board of India (SEBI) has started a pilot project to explore the tokenisation of corporate bonds through distributed ledger technology (DLT). This move is expected to boost liquidity and facilitate quicker settlement in the debt market, as per SEBI Chairman Tuhin Kanta Pandey. The pilot aims to evaluate how blockchain-based systems can enhance efficiency in bond trading and settlement while managing associated risks.
Pandey mentioned that corporate bonds in India are currently traded on established platforms, but SEBI is examining whether DLT-based tokenisation can further enhance market operations. By utilizing DLT and tokenisation for bonds, there is a potential for increased liquidity and instant settlement, he explained. This initiative is intended to bring stakeholders together and test an operational and technological model before broader implementation.
The Reserve Bank of India (RBI) has already released draft guidelines on this subject, with final norms expected soon, according to Pandey. Once regulatory approval is obtained, SEBI and exchanges are prepared to implement the framework. Discussing global equity markets, Pandey highlighted the current investor interest in artificial intelligence (AI), chips, memory, and other AI-related electronics driving valuations in key jurisdictions.
Pandey also compared market capitalisation trends between India and Taiwan, noting that India maintains a diversified market, unlike Taiwan where a few large technology firms dominate valuations.
