Coinbase has received a Financial Services Permission from Abu Dhabi Global Market’s Financial Services Regulatory Authority, giving the company a regulatory route to establish an international tokenization hub for securities in the UAE capital’s financial centre. The permission allows Coinbase to arrange deals in investments and provide custody services, two functions the company plans to use for tokenized securities issued within the Abu Dhabi Global Market framework.
The approval places Coinbase’s proposed tokenized-equities business under the supervision of the Financial Services Regulatory Authority, rather than operating through an unregulated crypto-market structure. Coinbase said the hub is intended to support securities that are registered and issued in Abu Dhabi Global Market, with digital tokens representing underlying shares.
Under the model described by Coinbase, holders of the tokens would receive the shareholder rights attached to the underlying shares, including dividend entitlements and voting rights. That structure distinguishes the planned products from synthetic stock tokens, which can track a company’s price without necessarily giving holders a legal claim on shares or corporate rights.
Permission covers custody and investment arrangements
The Financial Services Permission gives Coinbase authority to arrange investment transactions and provide custody within Abu Dhabi Global Market. Those permissions are central to the company’s plan because tokenized securities require both a regulated issuance and distribution process and secure handling of the assets or credentials linked to customer ownership.
Coinbase has not set out a timetable for the first tokenized securities to be issued through the Abu Dhabi hub. The announcement focused on the regulatory foundation for the business and described the permission as part of its expansion outside the United States.
Brett Tejpaul, co-chief executive of Coinbase Institutional, said the company sees Abu Dhabi Global Market’s framework as a basis for bringing traditional financial instruments onchain while retaining regulatory standards. Arvind Ramamurthy, chief market development officer at Abu Dhabi Global Market, said the centre’s rules were designed to support market development alongside oversight and compliance requirements.
Abu Dhabi Global Market introduced a virtual-asset regulatory framework in 2018, making it one of the earlier financial centres to build a dedicated regime for crypto-related activity. Its Financial Services Regulatory Authority has since licensed a range of digital-asset businesses, including firms offering custody, brokerage, exchange and advisory services.
Coinbase’s permission expands that regulatory footprint into tokenized securities, a segment that combines conventional securities rules with blockchain-based records of ownership and transfer.
Wallet-based access retains compliance controls
Coinbase said the proposed structure would allow users to hold tokenized securities through a wallet rather than requiring a conventional brokerage account or correspondent banking relationship. A correspondent banking relationship is an arrangement under which one bank provides payment and settlement services for another, often across borders.
The wallet-based approach could reduce some of the account and settlement layers associated with cross-border access to securities. It would not remove compliance obligations. Coinbase said transfers would be subject to continuing sanctions screening, and the framework would permit assets to be frozen or seized at the wallet level when legally required.
That feature shows how the planned system aims to combine onchain transferability with controls normally expected in regulated financial markets. A token may move on blockchain infrastructure, but the issuer and regulated service providers can retain intervention powers where sanctions, court orders or other legal requirements apply.
Coinbase described the tokens as securities, blockchain-native assets and instruments that can be used with decentralized-finance applications. “DeFi-composable” generally means an asset can interact with blockchain-based protocols such as lending, collateral or settlement applications. Whether tokenized equities can be used in such applications will depend on the specific product terms, applicable restrictions and the compliance controls built into the tokens.
Abu Dhabi and Dubai anchor separate UAE operations
The tokenization hub forms part of a wider UAE buildout involving two business lines, according to the announcement. One operation is focused on tokenized securities and onchain capital markets, while another is directed toward derivatives. Abu Dhabi and Dubai will host those activities.
The split reflects the UAE’s increasingly specialized financial-centre model. Abu Dhabi Global Market operates under its own financial-services regulator and legal framework, while Dubai has developed separate digital-asset rules through the Dubai Virtual Assets Regulatory Authority. Firms operating across the country may need to navigate different licensing requirements depending on the service, location and customer base involved.
Coinbase cited an estimate that 4 billion people globally lack access to capital markets, pointing to high participation costs and limited access to financial infrastructure. The figure illustrates the market-access case often made for tokenization: digital securities can potentially be distributed and settled through internet-connected wallets rather than relying entirely on local brokers, banks and market intermediaries.
Access alone will not determine whether those products reach a large retail audience. Securities eligibility, identity checks, local marketing rules, tax treatment and transfer restrictions can differ sharply between jurisdictions. Tokenized shares issued under Abu Dhabi Global Market rules would also need to meet the standards applicable to the underlying securities and the regulated entities handling them.
The permission gives Coinbase a defined legal base from which to test that model in a major international financial centre. Its practical value will depend on the securities eventually issued, which jurisdictions can access them, and whether the company can deliver the promised wallet-based experience without weakening the shareholder protections and compliance controls attached to regulated markets.
Explore how tokenized assets work in practice with our guide on tokenized equities and regulated digital markets.
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