- First Abu Dhabi Bank joins with Libre Capital for blockchain-based lending with tokenized RWA as collateral.
- Libre has tokenized and issued around $150 million in major investment funds.
The largest bank in the UAE, First Abu Dhabi Bank (FAB), has partnered with Libre Capital, a tokenization expert, to transform the use of real-world assets (RWA) as collateral in lending.
This collaboration is designed to enhance collateralized lending practices by leveraging tokenized versions of traditional investment assets. Notably, the approved lenders will be able to use RWA tokens as collateral for the stablecoin-backed loans under the partnership.
These tokens define digitized investment products from financial institutions like Brevan Howard, Hamilton Lane, and BlackRock. It aims to effectively bridge traditional finance with blockchain technology.
Furthermore, Libre Capital, which launched in March, has issued approximately $150 million in tokenized assets. The firm’s offerings include high-value investment assets like Brevan Howard funds, Hamilton Lane’s fixed-income products, and BlackRock’s money-market fund. Moreover, this partnership enables FAB to initiate a pilot program that offers credit lines secured by these tokenized assets.
FAB’s group head of global markets, Sameh Al Qubaisi, mentioned the bank’s dedication to innovation through this collaboration. The program incorporates automated processes assuring robust risk management and compliance with regulatory standards.
Empowering Asset Holders and Expanding the Ecosystem
The concept of leveraging crypto assets for lending purposes has been gaining traction, with FAB’s involvement benefiting from the stability and infrastructure of a traditional banking giant. However, by offering credit lines backed by tokenized assets, FAB aims to initiate an on-chain lending system that gives priority to stablecoins over traditional fiat currencies.
Besides, the initiative will make use of various blockchain networks, including Ethereum, Solana, Polygon, BASE, NEAR, and Aptos. These platforms ensure the seamless operation and liquidity management of tokenized assets across public blockchains.
Moreover, with a market capitalization of $335 billion, FAB’s role will include overseeing the provision of credit lines through broker-dealers and Laser Digital, which are integral to implementing the lending infrastructure.
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