# Retail Tokenisation By [Ex Machina](https://paragraph.com/@exmachina) · 2026-05-13 --- _Every previous wave of financial digitisation made existing systems run faster. Tokenisation is structurally different—by placing assets and money on a single shared ledger, it rebuilds the very shape of finance._ _This is a link-enhanced version of an article that first appeared in the Mint. You can read the original_ [_here_](https://www.livemint.com/opinion/online-views/tokenize-sovereign-debt-india-e-rupee-finance-evolve-rbi-cbdc-g-secs-crypto-digital-currency-11778509316638.html)_. For the full archive of all my articles, please visit_ [_my website_](https://rahulmatthan.com/ex-machina/)_._ * * * At the [Global Fintech Fest](https://www.globalfintechfest.com/) in Mumbai last year, the governor of the [Reserve Bank of India (RBI)](https://www.rbi.org.in/) announced the launch of a "next-generation financial market infrastructure," designed to "tokenise financial assets and settlements." While it received no more than a passing mention in his speech, the [Unified Markets Interface](https://www.medianama.com/2025/10/223-rbi-governor-fintech-vision-inclusion-trust-2025-digital-rupee-ai-dpi/) he mentioned appears to be an early signpost of the direction in which the digitization of India's financial sector is likely to progress. ### Beyond Dematerialization To understand the significance of this announcement, it is important to be clear about what a tokenised asset is and how it works. Tokenisation is the process of representing a financial asset as a digital entry on a shared ledger, so that the entry itself becomes the asset, rather than a record pointing to one held elsewhere. A tokenised asset is, therefore, a digital artefact that carries within it information about what the asset is, who owns it, what payments are due against it, and the rules governing its transfer. To transfer the ownership of a tokenised asset, you need to move the entry itself. If this sounds similar to [dematerialised shares](https://en.wikipedia.org/wiki/Dematerialization_\(securities\)), the difference lies in the ledger. Demat shares are held in the depository's database, and when one is bought or sold, the transaction is communicated via telecom messages, and balances get settled through end-of-day reconciliations. A tokenised asset ledger, on the other hand, is a [single digital record](https://rahulmatthan.com/ex-machina/2023/322.-the-unified-ledger/) that multiple participants can see and update in accordance with agreed rules. As a result, different assets sit alongside each other and can be transferred between owners on the same ledger. ### When Money and Assets Share a Ledger What would elevate this even further is if the funds used to procure these tokenised assets are themselves available on the same ledger. This is where RBI's wholesale [central bank digital currency (CBDC)](https://en.wikipedia.org/wiki/Digital_rupee) can play a role. The [wholesale e-rupee](https://rahulmatthan.com/ex-machina/2022/294.-a-new-digital-coin/) is a CBDC issued by the RBI for commercial banks to use among themselves. When this is combined with tokenised financial assets on the same ledger, transaction speed and certainty improve significantly. To understand how this would work, let's take the example of [Certificates of Deposit (CDs)](https://en.wikipedia.org/wiki/Certificate_of_deposit)—short-term debt instruments that banks often issue to quickly raise funds. Today, a buyer purchasing a CD pays for it through the interbank money transfer system, while the CD itself is transferred by a depository from the issuer's account to the buyer's account. These two transfers occur on different systems, with primary issuances settling on a [T+1](https://en.wikipedia.org/wiki/T%2B1) basis and secondary trades on either T+0 or T+1. As a result, till settlement, both parties carry a small risk that the other side will not perform. When a CD is tokenised, both the CD and the money used to buy it sit on the same digital ledger, so that when the trade takes place, the buyer's digital rupee moves to the issuer at exactly the same instant as the issuer's CD tokens move to the buyer. Either both transfers happen, or neither does. A tokenised CD can also incorporate [smart contracts](https://en.wikipedia.org/wiki/Smart_contract) (code embedded directly into a token's design) that upon maturity, destroy the tokenised CD and release an equivalent amount of digital rupees from the issuer's account as specified by the deal. The entire transaction can be done programmatically, with no manual intervention required, no separate depository action and no reconciliation between the parties to confirm that the trade has been settled. Once it proves reliable and settlement risk turns negligible, the capital that today sits locked up between trade and settlement is freed. Reconciliation—which currently requires the issuer, buyer, depository, clearing corporation and trade reporting platform to each keep their own records and match them against one another's—becomes redundant. And RBI, which today can only see what external platforms report to it, would be able to monitor the whole market in real time on its own ledger. ### A Different Shape, Not Just a Faster One Tokenised CDs are just one example. Once the digital rails needed are in place, government bonds, bank-issued IOUs and a growing range of other financial assets could sit on the same shared ledger and be traded the same way. So far, our financial digitisation measures have worked within the existing architecture, replacing analogue channels with digital ones. Demat platforms turned paper records into digital form. Electronic trading moved orders from telephones to terminals. [UPI](https://www.npci.org.in/what-we-do/upi/product-overview) moved payment instructions from cheques to phones. In each case, while individual systems were made to work faster, they still had to coordinate with each other. Tokenisation is structurally different from each previous wave. Instead of merely adding a layer, it removes the gap between the asset and money by placing them on a single record. It rebuilds not just the speed of our financial system, but also its shape. Last October, RBI quietly launched a [pilot to tokenise Certificates of Deposit](https://www.business-standard.com/economy/news/rbi-deposit-tokenisation-pilot-cbdc-wholesale-digital-tokens-oct8-125100700532_1.html), settling them in wholesale digital rupees on a permissioned ledger it runs. The natural next step is the market for [government securities (G-Secs)](https://en.wikipedia.org/wiki/Government_bond). While [Retail Direct](https://rbiretaildirect.org.in/) widened access, the minimum lot size remains beyond the reach of most small investors. Tokenised G-Secs in fractional denominations would bring the safest yield-bearing instrument to households that today rely on bank deposits and gold. The rails are ready for the government to get sovereign debt onto them. Every previous wave of financial digitisation speeded up existing systems. This one will change what they are. --- *Originally published on [Ex Machina](https://paragraph.com/@exmachina/retail-tokenisation)*