What to know:
- Coinbase gets FSRA approval for Abu Dhabi hub.
- Tokenized securities will be backed by underlying shares.
- UAE expansion adds tokenization and derivatives hubs.
Coinbase takes its tokenization effort to Abu Dhabi after receiving Financial Services Permission (FSP) to establish an international hub for tokenized securities.
The cryptocurrency trading platform said the permission granted by the Abu Dhabi Global Market’s Financial Services Regulatory Authority allows it to arrange deals in investments and provide custody, creating the regulatory foundation for its planned launch of tokenized securities.
Also Read: Circle Renews USDC Deal Through 2029, Maintains Growth-Focused Strategy
Coinbase Clears Regulatory Barriers
According to a recent post on X, Coinbase stated that ADGM would serve as its international tokenization hub. The company said the newly obtained FSRA permission will support its goal of making “global securities accessible to anyone with a wallet.”
The crypto exchange mentioned in its official blog post that the tokenized securities registered and issued in ADGM will be fully backed by underlying shares under FSRA supervision.
Moreover, verified token holders can receive shareholder rights, including dividends and voting rights, subject to the applicable conditions for the digital securities.
Also Read: Coinbase to Migrate Institutional Exchange Clients to Deribit on September 9
Traditional Securities Move Onchain
The innovation could potentially alter the way investors deal with certain securities. According to Coinbase, transactions limited to its digital securities would not require investors to establish a brokerage or bank account, although some redemption rights may still require an eligible brokerage or bank account.
Continuous sanctions screening will be performed by the company for all transfer activities, and it will have the ability to freeze or seize assets at the wallet level if needed.
According to Brett Tejpaul, who is Co-CEO at Coinbase Institutional, this innovation can allow tokenized equities to become “securities, blockchain-native tokens, and DeFi-composable assets.”
Also Read: Q2 Revenue Falls 14% as Prediction Markets Revenue More Than Doubles
What Comes Next
The crypto exchange is now moving toward using the regulatory foundation to develop its tokenized securities products. The company described the announcement as
“the most significant step we have taken yet” toward building a more open and accessible global financial system and stated, “The next frontier for global finance is onchain.”
In other words, the firm is not just gaining a license but establishing a regulated base from which it can explore how traditional financial markets can move onto blockchain infrastructure.
The move also forms part of Coinbase’s wider UAE strategy.
The firm confirmed that Abu Dhabi would be the hub for tokenized securities and onchain capital markets, while Dubai would act as the global hub for derivatives, further highlighting the increasing role of the UAE in the international expansion of the crypto exchange.
Also Read: Coinbase AiFi Could Drive Crypto Growth as AI Adoption Accelerates
Be the first to comment