In a bold move aimed at revolutionizing investment accessibility for the Indian middle class, Member of Parliament Raghav Chadha has proposed an "Asset Tokenization Bill" in the Indian Parliament. Chadha argues that tokenization, leveraging blockchain technology, holds the potential to democratize investment in high-value assets, much like the Unified Payments Interface (UPI) transformed digital payments in India.

Chadha highlighted the limited investment avenues currently available to the middle class, primarily consisting of bank savings accounts, mutual funds, and fixed deposits. He noted that commercial buildings, infrastructure projects, and private asset classes remain largely out of reach for the average investor. To address this disparity, Chadha introduced the concept of asset tokenization, describing it as a "financial revolution". Tokenization involves breaking down large, expensive assets into smaller digital tokens that can be openly traded on a blockchain. This fractional ownership model would enable individuals to own portions of real estate, infrastructure projects, and other valuable assets, potentially leading to better returns and enhanced financial security.

According to Chadha, a dedicated Tokenization Law is crucial for India's digital future, providing legal clarity and strength to digital transactions, data security, and the modern financial system. He emphasized that as India rapidly advances in digital payments, online banking, and digital assets, its laws must adapt accordingly. He believes that India needs clear and robust rules for tokenization and digital assets to keep pace with the world and advance on a global level.

The proposed bill also envisions a regulatory sandbox to attract global capital and boost domestic savings. By enabling fractional digital ownership, the bill aims to provide instant liquidity, higher returns, and eliminate traditional middlemen and high transaction costs.

Sumit Gupta, co-founder of CoinDCX, echoed Chadha's sentiments, emphasizing the need for serious policy frameworks, sandbox regulations, tax clarity, and investor protection to unlock India's illiquid wealth through blockchain-enabled tokenization while ensuring ecosystem safety. He agreed with Chadha's comparison, stating, "UPI = democracy of payments. Tokenization = democracy of assets. Digital India's next revolution: fractionalizing real estate, gold, securities & more for the masses".

The potential benefits of a Tokenization Law for the Indian economy are substantial:

• Increased Investment: Tokenizing rural assets like farmland and commodities could unlock an estimated ₹50,000 crore of untapped capital.
• Job Creation: The fintech and blockchain sectors could see the creation of millions of new jobs.
• Cross-Border Trade: Integration with infrastructure like UPI could boost exports.
• Innovation: MSMEs and startups could gain easier access to funding.

Currently, India lacks specific laws governing tokenization and digital assets, relying instead on existing regulations such as the Information Technology Act, the Digital Personal Data Protection Act, and RBI guidelines. Experts suggest that these laws do not adequately address the unique aspects of tokenization.

In conclusion, the call for a separate Tokenization Law reflects the need to update regulations to keep pace with technological advancements. A dedicated law could catalyze data security, investment, innovation, and economic growth.