New Delhi, May 26 (IANS). Market regulator Securities and Exchange Board of India (SEBI) has launched a Distributed Ledger Technology (DLT) based tokenization pilot project for the corporate bond market. Through this, the regulator is trying to increase liquidity in the debt market and speed up settlement. Chairman Tuhin Kant Pandey gave this information on Tuesday.
Panda said the objective of the pilot project is to understand whether blockchain-based systems can improve bond trading and settlement and what risks are associated with them.
“We have decided to launch a pilot project on the use of DLT for tokenization of corporate bonds,” Pandey told reporters.
He noted that corporate bonds in India are already traded on existing platforms, but the regulator is evaluating whether DLT-based tokenization could further improve the functioning of the market.
“We are trying to find out if we can use DLT and tokenization systems for bonds as well. Doing so will increase liquidity and faster settlements,” he said.
Pandey further said that this will help in bringing together stakeholders and testing an operational and technical model before wider implementation.
According to him, the Reserve Bank of India (RBI) has already issued draft guidelines on the subject and is expected to issue final rules soon. He said that SEBI and the exchanges are ready to implement this framework as soon as regulatory approval is received.
On global equity markets, the SEBI chief said investor enthusiasm towards AI, chips, memory and other electronics linked to AI infrastructure is currently boosting valuations across key sectors.
“Right now there are some leading companies that are directly or indirectly involved in AI,” he said.
On the comparison between India and Taiwan in market capitalization trends, Pandey said that unlike Taiwan, where a few large technology companies dominate valuations, India remains a diversified market.
–IANS
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