• Parliamentary Push: MP Raghav Chadha advocated for a Tokenization Bill in the Rajya Sabha to democratize asset ownership.

• Tokenization would allow fractional shares in expensive assets, providing broker-free liquidity to everyday investors.

• India’s middle class, currently limited to savings and mutual funds, could access high-return opportunities; experts estimate this could channel billions into domestic infrastructure.

Discover how India’s proposed Tokenization Bill could revolutionize asset ownership for the middle class via blockchain. Explore benefits, expert insights, and implications for inclusive finance today.

What is the Proposed Tokenization Bill in India?

The Tokenization Bill in India is a legislative proposal to legalize and regulate the tokenization of assets using blockchain technology, enabling fractional ownership of high-value items like real estate, infrastructure, and intellectual property. Introduced in a parliamentary speech by MP Raghav Chadha in the Rajya Sabha, it seeks to make investments inclusive, similar to how the Unified Payments Interface transformed digital payments. This bill would establish a regulatory framework, including a dedicated sandbox for testing, to ensure safe innovation and attract international investment.

How Would Tokenization Benefit India’s Middle Class?

Tokenization under the proposed bill would allow India’s middle class to invest in slices of assets traditionally out of reach, such as commercial buildings or highways, through digital tokens on blockchain platforms. This approach provides instant liquidity without intermediaries, potentially yielding higher returns than conventional options like fixed deposits. According to financial experts, this could unlock significant capital for infrastructure development; for instance, global markets have already tokenized over $10 billion in real-world assets in recent years, demonstrating the model’s viability.

Raj Kapoor, founder and CEO of the India Blockchain Alliance, emphasized that India is at a “decisive inflection point in the evolution of global finance.” He stated, “A dedicated tokenization bill is no longer optional—it’s a strategic necessity to anchor India in the next financial architecture.” Kapoor highlighted potential applications in infrastructure, small and medium enterprises, real estate, carbon credits, gold, and receivables, aligning them with existing securities laws.

Currently, regulatory ambiguity limits India’s progress, despite its strengths in digital public infrastructure. Jurisdictions offering legal clarity, such as Singapore and the UAE, are drawing global capital. Without the bill, Indian assets risk being tokenized offshore via special purpose vehicles, eroding domestic value. BlackRock CEO Larry Fink and COO Rob Goldstein recently noted in a publication that finance is undergoing a major evolution driven by blockchain tokenization, akin to the early internet era.

Musheer Ahmed, Founder and Managing Director of Finstep Asia, added that skepticism toward crypto should not overshadow tokenization’s benefits. “One needs to distinguish between crypto assets and digital assets with varied use cases,” Ahmed said. The bill would clarify rules for institutions, expand participation in high-value assets, and position India as a leader in financial innovation, fostering economic sovereignty.

Frequently Asked Questions

What Are the Key Features of the Proposed Tokenization Bill in India?

The Tokenization Bill proposes a framework for blockchain-based fractional ownership of assets like real estate and infrastructure, including a regulatory sandbox for testing innovations. It aims to integrate tokenized instruments with current laws on securities and contracts, ensuring compliance and security while promoting inclusive investment for the middle class through broker-free liquidity.

How Can Tokenization Transform Investment Opportunities in India?

Tokenization can make high-value assets accessible by dividing them into affordable digital tokens, allowing middle-class investors to participate in real estate or infrastructure projects with small investments. This provides liquidity and higher potential returns compared to traditional savings, while a clear regulatory framework would safeguard against risks and encourage onshore innovation.

Key Takeaways

• Inclusive Asset Ownership: The Tokenization Bill would enable fractional shares in expensive assets, broadening investment access for India’s middle class beyond bank savings and mutual funds.
• Regulatory Clarity: A dedicated sandbox and legal framework would attract global capital, positioning India competitively against hubs like Singapore and Hong Kong.
• Economic Sovereignty: Onshore tokenization prevents asset migration abroad, supporting domestic growth in infrastructure, MSMEs, and innovation.

Conclusion

The proposed Tokenization Bill in India represents a pivotal step toward inclusive finance, leveraging blockchain for fractional ownership of high-value assets and addressing middle-class investment limitations. By providing regulatory clarity and a sandbox for innovation, it could integrate tokenized real estate, infrastructure, and intellectual property into the economy, fostering liquidity and growth. As global leaders like BlackRock highlight blockchain’s transformative potential, India must act swiftly to secure its place in this evolving financial landscape—urging policymakers to prioritize this bill for a more equitable future.