India’s Securities and Exchange Board of India (SEBI) said on Thursday that three issuers have sold tokenized corporate bonds through its Demat 2 pilot, raising a combined 102.5 million rupees, or about $107.2 million.
SEBI said the pilot uses distributed ledger technology to issue, hold and settle corporate bonds.
Three issuers completed the first round of fundraising
REC Ltd. was the first to issue on Sept. 7, raising 50 million rupees, or about $52.3 million, from 18 investors.
L&T Ltd. raised a similar amount from four investors on Sept. 9. IIFL raised 25 million rupees, or about $2.6 million, from one investor on the same day.
Atomic settlement uses wholesale CBDC connectivity
According to SEBI, the pilot infrastructure records corporate bonds as native digital tokens on a distributed ledger owned by depositories. It connects to the Reserve Bank of India’s wholesale central bank digital currency through a unified market interface, allowing atomic settlement between the bond leg and the cash leg.
SEBI said this setup can reduce settlement risk created when securities and funds move separately. Issuers can receive funds on the same day after bidding, while the existing process usually takes two to three days.
The regulator added that bondholder information on the shared ledger is visible in real time to all authorized institutions, and e₹ payments on maturity will go directly to the holder’s central bank digital currency wallet.
Pilot does not create a new bond category
SEBI said the pilot does not create a new class of corporate bond. The tokenized bonds keep the same ISIN, issuer obligations, coupon, tenor, covenants, ratings and investor rights as conventional dematerialized bonds.
Next phases will cover secondary trading and retail access
The pilot will move ahead in three phases, SEBI said. The first phase covers institutional issuance, while secondary trading and retail participation will be tested in later phases through SEBI’s regulatory sandbox.