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Corporate-Bond Trading Is Moving Beyond Top Securities, Barclays Says
Confirmed
In Short: The Securities and Exchange Board of India (Sebi) and the Reserve Bank of India launched Demat 2.0, a pilot project using distributed ledger technology for corporate bonds.
The Securities and Exchange Board of India (Sebi) and the Reserve Bank of India launched Demat 2.0, a pilot project aimed at tokenizing corporate bonds using distributed ledger technology (DLT). The initiative was unveiled at the Global Fintech Fest in Mumbai by Sebi Chairman Tuhin Kanta Pandey and Reserve Bank of India Governor Sanjay Malhotra.
The pilot will initially focus on ongoing issuances before expanding to secondary trading and eventually retail investor access. Investors will continue using their existing demat accounts without needing a separate account or fresh Know Your Customer (KYC) verification.
Demat 2.0 combines tokenized securities with digital settlement assets using smart contracts and settles through the Central Bank Digital Currency (CBDC). The initiative is being led by depositories such as the Central Depository Services Ltd (CDSL) and the National Securities Depositories Ltd (NSDL), exchanges like the BSE and the National Stock Exchange (NSE), banks such as HDFC Bank and ICICI Bank, and the National Payments Corporation of India (NPCI).
SEBI Chairman Tuhin Kanta Pandey highlighted that the project explores whether distributed ledger technology can bring the security and settlement legs closer together, enabling faster settlement and automating parts of asset servicing.
During the launch, Pandey emphasized the importance of accuracy in financial systems, stating, “There is nothing like 99% accuracy here. You need to be 100% accurate, and every time, all the time, at population scale.”
The initiative also aims to create common digital rails for frictionless, consent-based credit delivery, similar to the Unified Payments Interface (UPI). Pandey addressed fintech representatives, stressing that operational resilience, business continuity, and cybersecurity are not burdens but the price of scale a firm has achieved.
What's confirmed
- The Securities and Exchange Board of India (Sebi) on Thursday launched Demat 2.0, a pilot project aimed at tokenising corporate bonds using distributed ledger technology (DLT).
What's still developing
- “That responsibility goes beyond the balance sheet of the firm. Operational resilience, business continuity and cybersecurity are not burdens or costs to be minimised. They are the price of the scale a firm has achieved. A firm that engages transparently not only earns regulatory goodwill, but also finds a faster and more durable path to scale,” he said, addressing fintech representatives.
- Still, the report arrives after Anthropic said in June that it had confidentially submitted an IPO prospectus to the Securities and Exchange Commission, a step reported by CNBC.