Coinbase has secured regulatory approval in Abu Dhabi to establish an international hub for tokenized securities. The Financial Services Regulatory Authority (FSRA) of the Abu Dhabi Global Market (ADGM) granted the U.S. cryptocurrency exchange a Financial Services Permission to arrange investment deals and provide custody services for the planned tokenized securities business.
Under the new regulatory framework, registered securities will be backed by underlying shares and supervised by the FSRA. Verified holders will receive economic rights tied to the assets, while certain shareholder rights, such as voting privileges, will depend on vesting conditions attached to the digital products. Investors will be able to hold these assets in digital wallets without opening a traditional brokerage account or setting up a correspondent banking relationship. Transfers will remain subject to sanctions screening, with assets capable of being frozen or seized at the wallet level when required.
Brett Tejpaul, co-CEO of Coinbase Institutional, noted that ADGM's 2018 introduction of a virtual asset regulatory framework was a major factor in the company's decision. He stated that no major financial center has previously built a framework treating tokenized equities simultaneously as securities, blockchain-native tokens, and decentralized finance-composable assets.
Expansion Builds on Project Diamond and Regional Growth
The new tokenized securities hub expands on Coinbase's existing operations in Abu Dhabi, which previously included Project Diamond. Initially established as a platform for issuing blockchain-based financial instruments focused on digital debt products for institutional users, Project Diamond utilized Coinbase's institutional technology stack, custody services, on-chain wallets, and USDC settlement on the Base blockchain.
Coinbase is dividing its United Arab Emirates operations by separating its business lines. Tokenized securities and on-chain capital markets will be centered in Abu Dhabi, while the company develops its global derivatives business from Dubai.
Abu Dhabi has already established regulated routes for blockchain-based investment products. In March, Ondo Finance received approval for tokenized U.S. stocks and exchange-traded funds within ADGM, and traditional financial institutions like BNY have also expanded digital asset and custody services in the jurisdiction.
Consulting firm Kearney and tokenization infrastructure company Ctrl Alt estimated that tokenized real-world assets across the Gulf Cooperation Council could approach $500 billion by 2030, driven by private markets, investment funds, bank deposits, and commodities.
