Regulatory Position
IFSCA sandbox Phase 2 approved. Full application in progress.
aarnâ IYP operates within India's regulatory architecture — not around it. This page addresses the questions institutional allocators, regulators, and partners ask before engaging.
What is aarnâ IYP?
aarnâ IYP (India Yield Platform) is a tokenised asset platform that issues permissioned digital securities representing beneficial interest in SEBI-regulated Indian financial instruments. The first product — ICT (India Credit Token) — tokenises interest in SEBI Category II performing credit AIFs for global accredited investors.
What is the regulatory status?
IFSCA FinTech Sandbox — Phase 2 Approved (17 April 2026)
Full FME (Fund Management Entity) licence application is in progress. aarnâ is not yet fully licensed by IFSCA. Sandbox authorisation permits regulated operations within sandbox-defined limits (investor count, AUM ceiling, product scope).1
What is the legal structure?
USD
GIFT City · FPI
INR
aarnâ FME — Fund Management Entity registered at GIFT City, IFSC, under IFSCA jurisdiction
FPI route — aarnâ FME subscribes into domestic SEBI-registered AIFs as a Foreign Portfolio Investor under SEBI FPI Regulations, 2019
SEBI Cat II AIFs — Underlying assets are managed by leading SEBI-registered Category II AIF managers with audited multi-vintage track records
GIFT City SPV — Dedicated vehicle holding AIF subscriptions. Investor assets are segregated from aarnâ's operating entity.
How are investors protected?
Identity and access control
ERC-3643 — Permissioned token standard. Every transfer validated against on-chain compliance rules. Only verified investors can hold or receive ICT.
Sumsub KYC — Institutional-grade identity verification. Accredited investor status, source of funds, jurisdiction — all verified before ONCHAINID issuance.
ONCHAINID — On-chain identity claims bound to investor wallet. Claims include KYC, AML, accreditation, and jurisdiction status.
Chainalysis AML — Ongoing wallet screening against OFAC sanctions lists and transaction monitoring.
Operational controls
3-of-5 multisig for all administrative contract functions (mint, burn, compliance module changes)
72-hour timelock on all contract upgrades and parameter changes
Circuit breaker (pause) accessible to 2-of-5 multisig for emergencies
Every on-chain event mapped to off-chain compliance record (immutable log, IPFS-committed)
What about tax treatment?
Consult your tax advisor for treatment specific to your jurisdiction.
What about data residency?
All investor data is stored in India. Infrastructure runs on AWS ap-south-1 (Mumbai region). Systems are designed to be CERT-In compliant. PII is never stored on-chain — ONCHAINID contains only cryptographic claim hashes. Actual KYC documents are held by Sumsub under data protection terms aligned with IFSCA requirements.
What about custody?
ICT is custodied through Fireblocks, which provides native ERC-3643 support via its Tokenisation Module. Investors may also self-custody using standard EVM wallets with KYC-approved (whitelisted) addresses. Institutional investors using Fireblocks, Anchorage, or BitGo can integrate through their existing custody infrastructure.
What happens if aarnâ ceases operations?
Investor assets are segregated in the GIFT City SPV. AIF subscriptions held by the SPV are SEBI-regulated instruments — they do not depend on aarnâ's technology layer for existence or value. In the event of operational discontinuity, investor claims are against the SPV, not against aarnâ's operating company. All investor records, compliance logs, and audit trails are maintained in immutable storage.
Further information
For regulatory inquiries, due diligence requests, or to review the IFSCA sandbox application and compliance documentation:
1 IFSCA FinTech Sandbox Phase 2 approval dated 17 April 2026. Sandbox parameters include investor count limits, AUM ceiling, and defined product scope. Full FME licence is a separate regulatory process.
Last updated: April 2026