The Securities and Exchange Board of India (SEBI) plans to launch Demat 2.0, under which tokenised corporate bonds would be available for secondary-market trading, Chairman Tuhin Kanta Pandey said on Saturday, October 24. He set out the plans in a keynote at the 16th International Capital Market Convention of the Association of NSE Members of India in Mumbai.
On technology, SEBI plans an AI sandbox where tools can be tested in a controlled setting, and is finalising guidelines on responsible AI use. These follow a tiered approach with kill switches, data controls and human oversight, in line with the IOSCO toolkit. The regulator is also exploring graded compliance for stockbrokers based on their scale, client exposure and reliance on technology, and is building a market-making framework for corporate bonds. Against fraud, it is rolling out validated UPI handles and verified labels for trading apps. Pandey told intermediaries to treat cyber security “as a business priority, not an IT expense”.
- Unique investors: more than 15 crore
- Outstanding corporate bonds: about ₹61 lakh crore
- Mutual fund assets: nearly ₹83 lakh crore
Why it matters: Putting tokenised corporate bonds inside the demat system would let them trade through the brokers and depositories investors already use, in a ₹61 lakh crore bond market that SEBI wants to make more liquid. SEBI gave no timeline, so the detail on who may issue, hold and trade the tokens will come in later consultation papers. Graded compliance and the AI rules will matter most to app-based brokers, whose costs depend on where SEBI draws the tiers.
Source: The Hindu BusinessLine, October 24, 2026; Business Standard, October 24, 2026
Image: Jimmy vikas, CC BY-SA 3.0, via Wikimedia Commons
