Coinbase has received regulatory approval from Abu Dhabi Global Market’s Financial Services Regulatory Authority to establish an international tokenization hub, marking the crypto exchange’s first regulatory base for bringing traditional securities onchain outside the United States.
The Financial Services Permission, granted on August 11, authorizes Coinbase to issue and register digital securities backed by underlying shares under ADGM oversight. The hub will treat tokenized equities simultaneously as securities, blockchain-native tokens, and DeFi-composable assets, according to Brett Tejpaul, co-CEO of Coinbase Institutional.
“No major financial center has yet built a framework that treats tokenized equities simultaneously as securities, blockchain-native tokens, and DeFi-composable assets,” Tejpaul said.
Abu Dhabi as a Tokenization Hub
Abu Dhabi has positioned itself as a testing ground for tokenization infrastructure. The Abu Dhabi Global Market introduced a regulatory framework for virtual assets in 2018 and has since attracted crypto and tokenization firms seeking to operate in a structured environment.
Tokenization is gaining traction across traditional finance, with global asset managers and banks putting funds, bonds, private credit, and stocks on blockchain rails. Supporters of the technology cite benefits including 24/7 securities transfers, near-instant trade settlement, and the ability to use tokenized assets as collateral in onchain markets.
Last month, Mubadala Capital, the asset management arm of Abu Dhabi’s sovereign wealth fund, tokenized a private-market investment strategy through KAIO, a UAE-based infrastructure provider, on Coinbase’s Base network. The transaction demonstrated the practical application of tokenization in the region.
Coinbase’s Existing Operations
Coinbase already operates a derivatives business in Dubai, establishing the exchange’s presence in the broader United Arab Emirates market. The new Abu Dhabi hub expands that footprint into the digital securities space.
Coinbase’s asset management arm initiated Project Diamond in 2023, laying groundwork for tokenization infrastructure ahead of the Abu Dhabi regulatory approval.
