Tokenisation can unlock hidden wealth, cut borrowing costs: Mudrex CEO

What tokenisation means for investors

Tokenisation could help Indians unlock the wealth tied up in assets such as gold and property by making ownership easier to verify, investments more accessible and borrowing against these assets potentially cheaper, Edul Patel, co-founder and chief executive officer of Mudrex, said at the Business Standard Smart Investor Arena 2026. “Most Indians as a nation are probably the most creditworthy people in the world. It's just that the wealth is hidden,” Patel said during a conversation with Business Standard's Ajinkya Kawale following the launch of Mudrex's report, A Builder's Guide to Tokenisation.

He argued that much of India's household wealth remains difficult for financial institutions to assess because ownership information is spread across different records and systems. Tokenisation, supported by verifiable ownership records and legal safeguards, could make these assets more visible to lenders and help borrowers access credit at lower interest rates. “The opacity gets removed, and with transparency there is more light, and as a result, it helps prove your creditworthiness better,” Patel said.

Patel said tokenisation could address fragmentation in India's debt market, where the same bond may be offered through multiple platforms. This can split trading activity across different venues, making it harder for investors to find buyers and sellers and establish transparent prices. “The promise of tokenisation is that this coordination ... can happen on this common single ledger,” he said, comparing the proposed arrangement with how equities are traded through common market infrastructure such as the National Stock Exchange and the BSE.

Can investors buy tokenised property or bonds?

Tokenisation could eventually allow investors to gain exposure to assets with relatively small amounts of money. But Patel cautioned against assuming that every asset can immediately be divided into small, tradable units. “What does it even mean to own Rs 100 of land? There are still unknown, unanswered questions,” he said, pointing to real estate as an asset class where legal ownership, customer demand and the market structure would need to evolve.

Some products are already available on Mudrex, Patel said, including tokenised equities and commodities. However, tokenised Indian equities, bonds and real estate are not yet broadly available to retail investors through the platform, as the regulatory pathways for these assets continue to evolve. A first tokenised bond issuance by Rural Electrification Corporation (REC) marked an important step in India's adoption of the technology, he said. However, Patel noted that the issuance did not yet have an active secondary market, meaning investors could not assume that the tokens could be freely traded.

He also said tokenisation should not be viewed primarily as a way to make everyday purchases using fractional ownership of assets. Instead, its longer-term value could lie in making assets easier to verify and use as collateral.

Trust and regulation will determine adoption

For tokenisation to work at scale in India, Patel said, investors must be confident that the digital representation of an asset is backed by enforceable ownership rights. “Having the regulatory infrastructure and the enforcement infrastructure around it is very important,” he said. He argued that India does not necessarily need a separate regulator for tokenisation because the technology does not create an entirely new asset class. Existing regulators should continue overseeing assets within their respective jurisdictions, while policymakers establish safeguards for the digital infrastructure.

Patel also said India would need a public digital infrastructure comparable to the Unified Payments Interface (UPI) to bring tokenised assets into wider use. “I strongly believe that for it to be successful in India, it'll have to be a sovereign public utility like UPI,” he said. Such infrastructure could help establish common standards for verifying ownership and transferring assets, while allowing private companies to develop consumer-facing products on top of it.

Crypto taxation remains a challenge

The discussion also touched on India's taxation of crypto assets, including the 30 per cent tax on applicable gains and the 1 per cent tax deducted at source (TDS) on transfers of virtual digital assets. Patel said crypto platforms must demonstrate their broader economic value if they want policymakers to reconsider the tax treatment. “The answer that exchanges and platforms like us need to come up with is exactly that. How does all of this help the country grow and become better?” he said.

He added that platforms could eventually expand beyond crypto trading to offer access to a wider range of financial assets as regulations and supporting infrastructure develop. Patel said the technology could become an invisible part of financial services over the next five years, allowing consumers to access a wider range of assets without necessarily having to understand the underlying infrastructure. “The magic will happen, and you should start getting more access to newer and different kinds of financial services at a cheaper cost,” he said.