UAE’s proactive regulations fuel real-world asset tokenization boom

Real-world asset (RWA) tokenization is gaining momentum in the United Arab Emirates (UAE) as industry players position themselves to meet increasing demand for blockchain-based asset trading.

RWA tokenization involves minting financial and other tangible assets into blockchain-based tokens, increasing accessibility and liquidity for traditionally illiquid assets. On Feb. 3, onchain RWAs rose to a cumulative all-time high of $17 billion, positioning the sector as a key crypto investment narrative in 2025.

With RWA tokenization on the rise, players in the UAE are seeing more assets tokenized as the region supports the sector. In an interview with Cointelegraph, Scott Thiel, the founder and CEO of Tokinvest — a UAE-regulated RWA platform — said there’s “no lack of demand” for RWAs.

Thiel said the demand comes from many developers and large real-estate asset owners exploring how to sell their assets through tokenization. “They all want to explore how they can use this as an alternate means of financing or selling their property,” Thiel told Cointelegraph.

Real estate leads the adoption of onchain RWAs in the UAE

Thiel noted that real estate is one of the leading industries adopting RWA tokenization in the UAE. He attributed this trend to the country’s booming property market, particularly in Dubai:

“Everyone wants real estate. What’s the hottest real estate market in the world? Well, I think today it’s probably Dubai, and so, everyone would like to own a piece of this or to get access to the economic benefits of being a participant in that marketplace.”

On Jan. 9, RWA blockchain firm Mantra signed a $1 billion deal to tokenize properties belonging to the Damac Group, one of the largest conglomerates in the UAE. The deal ensures that Damac’s tokenized assets will be available exclusively on the Mantra chain throughout 2025.

Mantra received its license from the Virtual Asset Regulatory Authority (VARA) on Feb. 19, allowing it to expand its operations into the Middle East and North Africa (MENA) region.

In a statement, OKX MENA CEO Rifad Mahasneh told Cointelegraph that the UAE saw a “significant growth in tokenization of real estate assets.” When asked which sectors are getting more traction regarding RWAs, the executive said it is “absolutely” the real estate industry.

“We’re seeing interest and pick-up in core industries in the UAE, like real estate, which has been in a boom phase for a number of years now, as well as the fashion and finance industries and VCs,” Mahasneh added.

The executive said this is primarily because of the evolving nature of real estate. The OKX MENA CEO said that with the surge of interest in crypto and RWAs, it was only natural for the two industries to converge.

However, Mahasneh said he believes RWA tokenization will diversify and expand to other industries. “The real potential lies in tokenizing assets like carbon credits or intellectual property and integrating them with blockchain technology,” he added.

Regulatory support “de-risked” a lot of Web3 activities

Thiel, who helped shape VARA’s regulatory framework in 2022, said the UAE stands out for its proactive approach to digital asset regulations. He noted that many global jurisdictions still struggle to develop clear guidelines for tokenized assets.

“The problem has been: how do I bring a tokenized RWA to market legally and compliantly? And that’s the problem I’ve wrestled with in multiple markets, such as Hong Kong, Singapore, the US, Canada, the UK, mainland Europe, you name it.”

He said that in the UAE, there is a genuine desire to develop clear guidelines. Because of this, the Tokinvest founder relocated to the region. On Jan. 14, Tokinvest received its full market license for its RWA platform from VARA.

Thiel also said that UAE regulators’ enthusiasm for providing clearer rules for the industry generally “de-risked” a lot of crypto activities in the region.

Mahasneh echoed this sentiment, emphasizing the advantages of operating in the UAE. “There’s a forward-thinking regulatory approach that allows organizations to expand the use of RWAs,” he said.

Besides regulation, Mantra CEO John Patrick Mullin said that the UAE and the wider MENA region have other advantages for the adoption of RWA tokenization. In a statement, Mullin told Cointelegraph that the region is rich with oil, gas and minerals.

He also said that many of the local population are classified as digitally native, meaning they are comfortable with technology and Web3. “The curiosity of the younger generation will lead to a rework of how markets across the region operate,” Mullin told Cointelegraph.

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