- FAB and Libre use tokenized RWAs to ease stablecoin lending.
- Multi-chain financing promotes innovation and regulatory compliance.
First Abu Dhabi Bank, the largest banking entity in the Middle East, will revolutionize lending with Libre Capital through blockchain technology. The Memorandum of Understanding between both firms in the UAE led to this initiative. It introduces a lending scheme that uses collateralized loans in stablecoin. Tokenized real-world assets support the scheme.
Libre Capital was launched at the beginning of this year 2024 and has already tokenized close to $150 million in assets, it comprises funds from Brevan Howard, Hamilton Lane, and BlackRock. Tokenized assets electronically represent real investment vehicles, allowing investors to use them as collateral in a decentralized, blockchain-based environment.
Blockchain-Based Lending Program
It’s a program that is part of the Project HODL of Libre, which runs on several blockchain networks, Ethereum, Polygon, Solana, and Coinbase’s BASE. This way, it is elastic and accessible. It streamlines lending by using stablecoins instead of fiat currency to align with the platform’s digital-first nature.
Libre’s founder and chief executive officer, Dr. Avtar Sehra emphasized innovative infrastructure for the program. This increases utility because, through an on-chain mechanism, it allows RWAs to act as collateral, he further elaborated. Existing financial institutions like Brevan Howard’s WebN Group and Nomura’s Laser Digital provide robust support, adding credibility.
FAB is therefore an embodiment of the fast-eroded distinction between traditional banking and blockchain innovation. FAB represents one of the world’s biggest banks, with an asset base of $335 billion. This is why participation is the increasing interest in the institutional adoption of digital asset-backed lending. Sameh Al Qubaisi, global markets group head at FAB, said innovation, combined with regulation, will offer a safe yet revolutionary lending environment.
MoU will help the pilot phase as FAB will offer credit lines to the approved lenders, and in the meantime, Libre’s tokenized assets will be incorporated into its liquidity management framework. This program brings together traditional finance and blockchain to set up the future for a more inclusive and advanced financial landscape.