UPDATE 2-Indian central bank to launch pilot for deposit tokenisation, official says

(Adds further comments from RBI official in paragraphs 5-7) By Ashwin Manikandan and Gopika Gopakumar MUMBAI, Oct 7 (Reuters) – The Reserve Bank of India will launch a pilot on deposit tokenisation on Wednesday, according to an official at the central bank. Digital tokenisation refers to creating digital representations of assets such as deposits, stocks and bonds that are stored on a blockchain. This process could make transactions faster, cheaper and safer. The RBI will use the wholesale segment of its central bank digital currency (CBDC) as the underlying layer for the exercise, Chief General Manager Suvendu Pati said at an event in Mumbai on Tuesday, adding that the central bank is working with "a few banks" on the project. "From a regulatory standpoint for tokenisation of an underlying asset, we believe integrity and enforcability have to be established, Pati said. "Risks in asset tokenisation are manageable and can be addressed through regulatory guardrails." Pati added that the central bank is also looking at experimenting with tokenisation in money market instruments, including commercial papers. (Reporting by Ashwin Manikandan in Mumbai; Writing by Kashish Tandon; Editing by Sonia Cheema and Janane Venkatraman)

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