India Launches Demat 2.0 for Tokenized Corporate Bonds

India’s Securities and Exchange Board of India (SEBI) has launched Demat 2.0, a pilot program designed to tokenize corporate bonds and settle transactions using the Reserve Bank of India’s wholesale digital rupee, according to CoinMarketCap.

The initiative was officially launched by SEBI and the RBI on Sept. 10, 2026, at the Global Fintech Fest in Mumbai. The pilot combines distributed ledger technology with central bank digital currency to bring the securities and payment legs of a transaction closer together.

SEBI and RBI Test Tokenized Corporate Bonds

Demat 2.0 is focused on corporate bonds, with the pilot testing the issuance, holding and settlement of tokenized securities through distributed ledger technology. The system connects tokenized bonds with the RBI’s wholesale digital rupee, allowing the securities and payment sides of a transaction to be settled together.

The project builds on India’s existing dematerialized securities infrastructure while introducing tokenization and digital-rupee settlement. Major market infrastructure institutions and financial firms participating in the initiative include CDSL, NSDL, BSE, NSE, HDFC Bank, ICICI Bank and NPCI.

The pilot has already involved three corporate bond issuances totaling ₹1,025 crore. Participants include REC Limited, Larsen & Toubro and IIFL Finance, according to reports on the initial implementation.

Digital Rupee Enables Atomic Settlement

A key feature of Demat 2.0 is its use of the wholesale digital rupee for settlement. By linking the tokenized security with digital central bank money, the system is designed to enable simultaneous delivery of the bond and payment, potentially reducing settlement and operational risks.

The pilot also explores automated asset servicing through distributed ledger technology and smart contracts. This could eventually streamline processes associated with interest payments, redemptions and other corporate actions, although the current initiative remains a pilot rather than a full replacement for India’s existing securities infrastructure.

The broader significance is that India is testing tokenization directly within regulated capital-market infrastructure rather than treating blockchain-based securities as a separate market. The next major test will be how the system performs as trading and settlement activity expands beyond the initial pilot phase, including the development of a secondary markets for tokenized corporate bonds.

Writer: Victoria Hale
Technology & Blockchain Writer

Victoria Hale writes about blockchain technology, digital infrastructure, and the intersection of emerging technologies with finance. Her articles explore how new protocols and systems are shaping the evolving digital economy.

She prioritises clarity and accuracy when explaining technical developments to a general audience.