UAE Bank Teams Announces New Partnership for Blockchain Collateralized Lending

The UAE's First Abu Dhabi Bank (FAB) has teamed up with Libre Capital to advance blockchain-based lending using real-world asset (RWA) tokens.

Through a newly signed Memorandum of Understanding (MoU), the collaboration aims to enable collateralized credit lines, where lenders can provide loans backed by RWA tokens issued by Libre.

Libre Capital, supported by Brevan Howard’s WebN Group and Nomura’s Laser Digital, launched in March and has since tokenized $150 million in assets. These include fixed-income products from Hamilton Lane and a BlackRock money-market fund. The partnership with FAB will focus on testing a new credit line system where stablecoins can be borrowed using Libre’s tokenized assets as collateral.

This move marks a significant step toward integrating traditional finance with blockchain technology, allowing crypto holders to use their tokens as collateral for loans. Libre’s blue-chip RWA tokens gained attention after being proposed as collateral in a MakerDAO forum. As part of the deal, FAB will manage the liquidity of these assets and extend credit lines to lenders, using public blockchains like Ethereum, Polygon, and Solana for the transactions.

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Libre’s CEO, Dr. Avtar Sehra, emphasized that this initiative would enhance the value of its assets by adding a lending dimension. The loans will be made in stablecoins and managed by institutions like FAB, marking a shift toward secure, tokenized financial systems. FAB’s global markets head, Sameh Al Qubaisi, highlighted that the partnership is part of the bank’s broader strategy to foster financial innovation within the UAE, focusing on secure and compliant lending practices.

Kosta Gushterov