First Abu Dhabi Bank (FAB), the biggest bank in the UAE, has partnered with tokenization expert Libre Capital to change collateralized lending by using real-world assets (RWA) in a digital way.
This partnership seeks to improve lending by letting approved lenders use tokenized traditional investment assets as collateral for loans backed by stablecoins. The tokens are digital products from well-known financial institutions like Brevan Howard, Hamilton Lane, and BlackRock, combining traditional finance with blockchain technology.
Libre Capital started in March and has issued about $150 million in tokenized assets, including valuable investment products. This partnership allows FAB to test a program that provides credit lines backed by these tokenized assets.
Sameh Al Qubaisi, FAB’s group head of global markets, stressed the bank’s focus on innovation. He pointed out the program’s automated processes that help maintain strong risk management and meet regulatory requirements.
The initiative shows a rising trend of using crypto assets for lending, with FAB’s strong infrastructure offering stability. FAB wants to build a lending system on the blockchain by focusing on stablecoins instead of regular money.
The project will use different blockchain networks like Ethereum, Solana, and Polygon to help manage and operate tokenized assets smoothly. FAB, with a market value of $335 billion, will manage credit lines through broker-dealers and Laser Digital. These are important for setting up this new lending system.
