NSDL launches BlockChain-based platform for security and covenant monitoring

• ByStartupStory     |    May 9, 2022

National Securities Depository Limited (NSDL) launched a Distributed Ledger Technology (DLT) platform for security and covenant monitoring on 7th May. This blockchain-based platform was created by NSDL & SEBI to ease the monitoring of security and governance in the corporate bonds market. It would further bring more discipline and transparency to the market. 

Madhabi Puri Buch, the SEBI Chairperson launched this platform in presence of Union Finance Minister Nirmala Sitaraman. She also said that day that with respect to market, security, investments and payments people are mainly trusting in DLT. She also mentioned transparency and the real-time nature of the technology as the key highlights of DLT which are some of the reasons for its popularity. 

The SEBI Chairperson doubted the cost-effectiveness of the technology. Although a lot of people say DLT is cost-effective, she added that technology is not cost-effective now but if it becomes so then it will be another attractive feature of DLT. In addition to this, she said that anonymity is the only biggest differentiator between DLT and Central Bank Digital Currencies. 

The Finance Minister also raised concern over the inherent risk of anonymity with blockchain technology. NSDL based in Mumbai was established in August 1996 is an Indian Central Securities Depository. It is the country’s first electronic depository to have National coverage. After the launch of DLT, NSDL proposes to have a strong framework for blockchain technology for transforming the corporate bond market with some intensified technology.

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