Loyaltization: Unlocking Loyalty Through Tokenization

If you have been in Web3 for long, you have heard enough about Web3 projects in loyalty and rewards. Whether it’s the Starbucks programs spreading the hopes of NFTs or the MiL.k Alliance ecosystem, each loyalty initiative has tried its best to make Web3 the norm. So, will Web3 ever see seamless adoption by users? Or is it even possible in India? The answer is a resounding yes—thanks to a concept I call “Loyaltization” (the tokenization of loyalty programs).

In this article, I will introduce you to how Web3 in India is much closer to super-scale adoption than any other type of Web3 project. I am going to cover three things that support Loyaltization in 2026 and beyond:

• Trends that Mattered in 2025
• The Future of Web3 Loyalty in India
• Regulations in India and How Stakeholders Can Manage Them

Trends That Mattered in 2025

In 2025, three major shifts set the stage for Web3 loyalty. Inter- and intra-brand programs became common, stablecoins made tokenization cheaper and more practical, and brands shifted harder toward performance-driven marketing. Together, these forces created the ideal foundation for Loyaltization to move from concept to real adoption.

Let’s dive in to understand more.

Inter/Intra-Brand Programs Becoming a Norm

Apart from airline miles or banking/credit card points programs, there were barely any programs that customers subscribed to and wanted to redeem for the best value. Airline miles gave customers the flexibility to transfer miles/rewards through partner airlines, which were lucrative, and credit cards related to a single brand—say, e-commerce or fuel-related cards—helped gather one segment of the customer base.

Come 2025, the game evolved to another level. IndiGo’s BluChip partnered with Swiggy, a unique partnership of food delivery and airlines. In response, Air India’s Maharaja Points partnered with Zomato. The Indian ecosystem of loyalty is just getting hotter with these kinds of partnerships. One of the long-term program partnerships is where a customer gets to convert their loyalty points from fueling their vehicle into future assets. The Shell Asia app allows its customers to convert Shell points to buying a Gold ETF through Muthoot Finance. Never have brands been this thoughtful and forward-thinking about what matters to their customers. Whether it’s modern India or the power of Gen Z having disposable income, this is the era of super loyalty in the making.

Stablecoin Success

Web3’s product-market fit has always been in question. 2025 has been the era where political forces moved the needle heavily towards blockchain in the form of stablecoins. From the number of USD-based stablecoins to chains able to minimize the cost of having a stablecoin, last year saw some major breakthroughs. It is going to be a matter of time before the stablecoin providers are as diverse as Mastercard and Visa.

One major release that is absolutely going to change the online and offline transactions is X-402. Circle and Coinbase pioneered something radical on Shopify. It is just a matter of time before this is picked up by loyalty programs, before stablecoin integration sees global integrations across borders.

Brands Itching for Customer Wallet Share

AI-led digital marketing took over the ad spending market in 2025. Exchange4media has shared multiple quotes from top marketers in the country about how brands are more poised towards performance marketing. If you are Web3 native, performance marketing is strictly focused on revenue or user base as a measure of success. Branding, which is to help make sure brands try to be at the top of the customer’s mind, took a back seat. In my opinion, it is a passing phase, and touching the customer’s heart is still the key to share of wallet or market. Branding will come back in due course. Google and Meta’s financial year reports would be mega for 2025.

Future of Web3 Loyalty in India

The exceptionally low cost of tokenization, the need for lower ROAS (Return on Ad Spend) from brands, and lifestyle-based loyalty programs are three factors that are going to change the way loyalty is seen by new-age spenders. Web3 has a crucial role to play in this. Privacy, transparency, and personalized recommendations are cornerstones on which the Web3 inter-brand loyalty game is going to change.

In 2018, the Bond Loyalty Report suggested the need for a single currency among very different brands for users to make the most of loyalty programs. The way I see it, the multi-brand loyalty program will be more like SuperCoins on steroids. It will be a combination of SuperCoins and CRED coins. This segment will evolve into three categories: ultra luxury loyalty, traveler-based loyalty, and smart trendy loyalty. Each segment is very unique, with multiple brands sharing the information over reputation tokens and reward programs interacting like a loyalty exchange. The play for tokenization projects is massive, and it will be more about who will bite the bullet first. Another dimension that will evolve is digital loyalty for spending time on apps, a segment that would be different from the three most prolific ones.

The size of each of the segments will be 2-5% of the digital ad spending market in India this year, with potential for super growth. If you understand digital marketing, Web3, and loyalty, you are going to be in a super-unique position to make a strong impact by spreading Web3 in India.

Regulations in India and How Stakeholders Can Manage Them

India’s crypto regulation for taxation is subject to off-ramping, on-ramping, staking, or gifting of crypto tokens. Loyalty points tokenization, as long as it has a steady value, is arguably not within the guidelines as long as you can meet two conditions as a brand:

• Keep the tokens in P2M (Person-to-Merchant) or M2M (Machine-to-Machine) mode.
• Don’t allow a cash-out process.

In order to be safe, do not allow P2P (Person-to-Person) transactions till the government comes out with a low-risk tokenization framework, or use a good law firm to get clarity. However, owing to the non-speculative nature of loyalty and already existing partnerships of brands, the adoption of Web3 loyalty is just on the verge of becoming a massive success.

Conclusion

In a nutshell, this is going to be an incredibly great year for Web3 adoption in loyalty ecosystems in India. This foundation will help with stablecoin adoption as a clear case of custodianship and technology in different forms and shapes in India soon.

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Author: Pawas Chandra, Web3 Builder