Coinbase, a leading global cryptocurrency exchange, has secured regulatory clearance from Abu Dhabi authorities to establish an international hub dedicated to tokenized securities. The Financial Services Regulatory Authority (FSRA) within Abu Dhabi Global Market (ADGM) granted Coinbase a Financial Services Permission, formally bringing the company under the emirate’s regulated financial ecosystem.
Regulatory framework and investor access
The permission allows Coinbase to arrange investment deals and offer custody services for tokens backed by shares. All securities issued under this structure will be tied to underlying equities and subject to direct oversight by the FSRA, ensuring enhanced investor protection and regulatory transparency.
Verified investors will receive economic rights linked to the underlying assets in these tokenized products, with some shareholder rights such as voting determined by specific vesting arrangements. Individuals can hold these instruments in digital wallets, eliminating the need for traditional brokerage accounts or bank relationships.
Transfers of these products will be subject to sanctions screening, and Coinbase retains the ability to freeze or seize assets at the wallet level if required by authorities.
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AAPLCoinbase described the regulatory approval as “one of the biggest steps toward building an open financial system.”
The launch of the hub strengthens Abu Dhabi’s position as a regional center for regulated digital financial products.
Expansion on Project Diamond
Before receiving this latest approval, Coinbase had already initiated tokenization efforts in the region through Project Diamond, its proprietary platform for issuing blockchain-based financial instruments. Project Diamond received initial approval from ADGM and debuted with a short-term discount note issued in USDC on the Base blockchain.
In late 2024, Project Diamond integrated Chainlink’s Cross-Chain Interoperability Protocol (CCIP), providing institutions with verified, cross-chain data and broader connectivity for tokenized assets.
Brett Tejpaul, co-CEO of Coinbase Institutional, cited ADGM’s virtual asset framework—launched in 2018—as a cornerstone for selecting the jurisdiction. He highlighted the innovative approach of regulating tokenized equities, blockchain tokens, and DeFi assets under a single comprehensive regime.
Mini dictionary: Chainlink CCIP, or Cross-Chain Interoperability Protocol, enables smart contracts and tokenized assets to move securely and seamlessly across different blockchains, allowing greater flexibility and composability for institutional and retail users.
Market competition and regional expansion
Coinbase enters a market where other blockchain-based product providers are already established in Abu Dhabi. Ondo Finance received approval earlier this year to issue tokenized equities and exchange-traded funds linked to large US companies such as Amazon, Apple, Microsoft, and Tesla. Ondo’s offerings are structured as equity-linked notes.
BNY, one of the world’s largest banks, launched custody services for Bitcoin and Ether within ADGM through a partnership with Finstreet Limited and the ADI Foundation, and plans to extend support to tokenized assets and stablecoins.
Globally, Coinbase has also rolled out tokenized shares associated with major companies including SpaceX, Nvidia, Google, Strategy, and Bitmine, each fully backed by underlying securities.
| Company | Product Type | Jurisdiction | Year Approved |
|---|---|---|---|
| Coinbase | Tokenized equities/securities | Abu Dhabi (ADGM) | 2024 |
| Ondo Finance | Tokenized US stocks, ETFs | Abu Dhabi (ADGM) | 2024 |
| BNY | Bitcoin/Ether custody | Abu Dhabi (ADGM) | 2024 |
The international hub in Abu Dhabi is part of Coinbase’s strategy to expand its footprint across the United Arab Emirates, with derivatives development running independently in Dubai.
Research by consulting firm Kearney and tokenization company Ctrl Alt suggests that tokenized real world assets in the Gulf Cooperation Council could grow substantially, potentially approaching $500 billion by 2030. Significant growth is expected in private markets, investment funds, and tokenized bank deposits.
Local company KAIO secured $8 million in investment this April from supporters including Tether and Nomura-backed Laser Digital, working to bring products from global firms like BlackRock, Brevan Howard, and Hamilton Lane onto public blockchains.
