Dubai’s Virtual Assets Regulatory Authority (VARA) and Securitize, a BlackRock-backed tokenization platform, have signed a Memorandum of Understanding (MoU) to advance tokenization and digital asset infrastructure across Dubai and the United Arab Emirates.
The agreement announced on September 3, 2026, establishes a collaborative framework to support regulated tokenization initiatives, foster institutional participation and strengthen Dubai’s digital asset ecosystem. The two organizations said the MoU is designed to explore how tokenized financial innovation should be regulated in the region and to attract more talent to Dubai’s virtual asset sector.
The MoU comes as tokenization of real-world assets (RWAs) moves from experimental pilots toward mainstream financial infrastructure. Asset managers, banks and exchanges are increasingly exploring how blockchain-based representations of funds, bonds, private credit, real estate and commodities can improve settlement, broaden access and create new liquidity pathways.
What the VARA-Securitize MoU covers
Under the agreement, VARA and Securitize will collaborate on tokenization initiatives in Dubai, including projects initiated by VARA. The framework is intended to support regulated tokenization efforts, encourage institutional participation and help identify where regulatory oversight can enable trusted tokenized markets.
A VARA spokesperson told reporters that the MoU’s main goal is to create a broad framework for collaboration between the two firms rather than a specific technological stack or product. The spokesperson said the intention is to combine VARA’s regulatory perspective with Securitize’s experience in institutional tokenization to identify where collaboration can help support the development of trusted, regulated tokenized markets in Dubai.
There will not be any specific projects announced at this stage of the MoU, the spokesperson added. Instead, the agreement provides a collaborative framework to support relevant tokenization initiatives in Dubai. That distinction matters: the MoU is not a product launch, a license approval or a binding commercial contract. It is a signal that Dubai wants institutional tokenization expertise at the table as it refines its regulatory approach.
VARA and Securitize also aim to attract more talent to Dubai’s virtual asset ecosystem. The talent component reflects a broader competition among financial hubs to draw legal, compliance, engineering and product specialists who understand both traditional capital markets and blockchain infrastructure.
Why Dubai is positioning itself as a tokenization hub
Dubai has spent years building a regulatory framework for virtual assets. VARA, established in 2022, oversees virtual asset activity in Dubai outside the Dubai International Financial Centre (DIFC). The authority has developed licensing requirements, rulebooks and supervisory expectations for virtual asset service providers (VASPs), with a focus on market integrity, consumer protection and financial crime compliance.
In July, VARA granted its 50th VASP license to tokenization platform Tribe Tokenisation FZE. The milestone illustrates how Dubai’s licensing regime has moved from early adoption to a more mature phase, with a growing roster of regulated firms operating in the emirate.
Dubai’s broader strategy includes attracting banks, asset managers, exchanges, custodians and fintech companies that want a clear regulatory pathway. The DIFC and Abu Dhabi Global Market (ADGM) have also developed digital asset regimes, creating a multi-jurisdictional environment that can accommodate different types of firms and activities. For tokenization platforms, that regulatory clarity is a competitive advantage when deciding where to establish operations, build partnerships and serve institutional clients.
The emirate also has a strong tradition in trade, logistics, aviation, tourism and financial services. Tokenization can intersect with those sectors through tokenized commodities, trade finance instruments, real estate fractional ownership and fund structures. Dubai’s time zone, which bridges Asian and European markets, adds another layer of appeal for firms seeking round-the-clock trading and settlement.
Securitize brings institutional tokenization experience
Securitize ranks as the world’s largest tokenization platform with $4.9 billion in tokenized assets under management, according to industry data. Ondo Finance ranks second with $3.5 billion. Securitize has worked with asset managers to bring traditional financial products onto blockchain rails, including tokenized funds and private credit strategies. Its connection to BlackRock, one of the world’s largest asset managers, has made it a prominent name in the institutional RWA space.
Carlos Domingo, co-founder and CEO of Securitize, said Dubai has emerged as one of the world’s most forward-looking jurisdictions for digital asset innovation. He emphasized the importance of collaborating with regulators as tokenization moves from concept to mainstream financial infrastructure.
That quote captures the strategic logic behind the MoU. Tokenization platforms need regulated venues and clear legal treatment for tokenized assets. Regulators need market experience to understand how tokenized products behave in practice, how investors access them and where risks may emerge. A framework that pairs regulatory authority with institutional expertise can help both sides avoid the pitfalls of either over-regulation or under-regulation.
The RWA tokenization market is growing quickly
The announcement follows increasing investor demand for tokenized assets. Total RWA holders rose 103% in the past 30 days to 3.2 million, while the total value of tokenized assets rose 2% to $38.5 billion in the same period, according to industry tracker data.
Those figures reflect a market that is still small relative to global capital markets but growing at a notable pace. Tokenized treasury products have attracted billions in assets because they offer yield-bearing exposure with blockchain-based settlement. Private credit, commodities, real estate and equities are also being explored, though each asset class brings different legal, operational and liquidity considerations.
Tokenization can offer several benefits. It can enable fractional ownership, potentially lowering minimum investment thresholds. It can support 24/7 transfer and settlement, depending on the blockchain and legal structure. It can improve transparency if ownership records and transaction histories are recorded on distributed ledgers. It can also reduce some operational frictions by automating compliance checks, transfer restrictions and corporate actions through smart contracts.
At the same time, tokenization introduces challenges. Legal enforceability of on-chain ownership rights varies by jurisdiction. Custody arrangements must be robust. Anti-money laundering and know-your-customer requirements must be applied consistently. Interoperability between blockchains and traditional market infrastructure remains a work in progress. Regulators must also consider how tokenized assets fit within existing securities, commodities and banking laws.
Global competition in tokenized markets
Dubai is not alone in pursuing tokenization. Days before the VARA-Securitize announcement, the London Stock Exchange reportedly partnered with crypto exchange Kraken to launch tokenized stock trading on the operator’s night-time trading venue, aiming to offer 24/5 trading. The move underscores how traditional exchanges are exploring blockchain-based settlement and extended trading hours.
Other jurisdictions are moving as well. The European Union has experimented with a distributed ledger technology pilot regime for market infrastructures. Switzerland, Singapore and Hong Kong have developed frameworks for digital assets and tokenized securities. In the United States, regulators and lawmakers continue to debate how existing securities laws apply to digital assets, with tokenized funds and treasury products already operating under certain structures.
This global competition matters because tokenization is inherently cross-border. A tokenized fund issued in one jurisdiction may be marketed to investors in another. A tokenized bond may settle on a blockchain while being held by a custodian in a third country. Regulatory cooperation, mutual recognition and clear rules for cross-border activity will shape how quickly the market scales.
Dubai’s MoU with Securitize can be seen as part of that competitive strategy. By working with a major tokenization platform, VARA can gain insight into how institutional tokenization products are structured, how compliance is handled and what infrastructure is needed to support regulated markets. Securitize, in turn, can deepen its relationships in a region that is actively courting digital asset firms.
Potential use cases in Dubai and the UAE
The UAE’s financial landscape offers several potential tokenization use cases. Tokenized money market funds and treasury products could appeal to institutional and high-net-worth investors seeking yield and liquidity. Tokenized real estate could allow fractional ownership of properties in a market known for high-value developments. Tokenized commodities could connect Dubai’s trade flows to blockchain-based financing and settlement.
Islamic finance is another area of interest. The UAE is a global hub for sukuk, or Islamic bonds. Tokenized sukuk could improve distribution, settlement and transparency while adhering to Shariah requirements. If structured correctly, tokenization could broaden the investor base for Islamic financial products and reduce operational costs.
Tokenized private credit is also gaining attention. Private credit has grown rapidly as an asset class, but it is often illiquid and accessible mainly to institutional investors. Tokenization could create secondary market opportunities, though legal and valuation challenges remain. Regulated platforms would need to ensure that token holders have enforceable rights and that transfers comply with securities laws.
What happens next
The MoU does not announce specific projects at this stage. VARA and Securitize will use the framework to identify areas where collaboration can support trusted, regulated tokenized markets in Dubai. The agreement may lead to joint research, industry consultations, pilot programs or regulatory sandbox initiatives, but those details have not been disclosed.
The immediate takeaway is that Dubai continues to position itself as a jurisdiction where digital asset firms can engage with regulators constructively. For Securitize, the MoU strengthens its presence in a region that is attracting global crypto and fintech talent. For VARA, the collaboration offers access to institutional tokenization experience as it shapes rules for a market that is still evolving.
As tokenized RWA adoption grows, the relationship between regulators and tokenization platforms will become more important. The VARA-Securitize MoU is one of the latest signs that Dubai intends to be part of that conversation, not just a spectator. The framework remains at an early stage, and its impact will depend on how the collaboration translates into concrete regulatory guidance, pilot projects and institutional participation.
Source: Cointelegraph News