It’s 2026 now, and the UAE is proving there’s more to “tokenization” than a pilot or sandbox. 

Dubai, Abu Dhabi, and other innovation centres are writing rules for what a regulated asset token looks like, who may issue it, where it can trade, and what obligations follow. Just as important, real projects are now being launched under those rules.

This matters to market infrastructure providers, trading platforms, custodians, exchanges, and private market rails. Not because “blockchain is inevitable”, but because operational requirements are becoming explicit – build decisions are becoming easier. 

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Dubai regulatory momentum supports tokenization in the UAE

Dubai’s Virtual Assets Regulatory Authority (VARA) has expanded its regulatory framework to explicitly cover real-world asset (RWA) tokenization through a class category it calls Asset-Referenced Virtual assets (ARVAs). In practice, this is a formal attempt to describe asset-backed tokens as regulated instruments with issuance and ongoing obligations, rather than a special case relying on bespoke approvals. 

VARA’s framework lays out issuer requirements in plain regulatory language. The most recent edition is found here: https://rulebooks.vara.ae/rulebook/virtual-asset-issuance-rulebook‍

For institutional teams, two details are worth noting. 

First, the logic is issuance-first. Issuers of tokenized RWAs must obtain a Category 1 Virtual Asset License, a compliant whitepaper must be published, and tokenized assets must be fully backed by audited underlying assets. Ongoing disclosure, reporting, and compliance obligations apply.

Second, the framework is written to support market structure. Crucially, VARA permits secondary market trading of tokenized RWAs on licensed exchanges and broker-dealers. If issuance is regulated and distribution venues are licensed, then custody, trading, and reporting can be organized around standard roles. 

In other words, Dubai has moved from pilot programs to a repeatable production pathway. 

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Abu Dhabi regulated digital securities as a known category

Abu Dhabi Global Market (ADGM) was first in the region to introduce a digital assets framework, which caters to various activities and product offerings in relation to digital assets, fiat-backed tokens, digital securities, plus derivatives and funds of digital assets.

ADGM’s FSRA is explicit about providing legal certainty for digital securities and tokenized assets through the existing financial services perimeter with blockchain-specific considerations, operating under English common law. You can find reference materials here: https://www.adgm.com/setting-up/digital-assets‍

Notably, the Financial Services Regulatory Authority (FSRA) licenses and supervises tokenized funds and securities, exchanges and custodians, and market infrastructure for digital assets. 

The clarity offered by the AGDM positions Abu Dhabi as a locus for large-scale institutional tokenization, particularly for financial instruments, investment vehicles, and RWAs. When there are known regulatory expectations, issuers and providers can plan around licensing, controls, custody, disclosure, and market conduct.

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Market validation through a tokenized real estate live example 

The UAE’s rulebook approach is being validated by real market momentum. 

In May 2025, Dubai Land Department (DLD) announced the launch of what was described as the first tokenized real estate project in MENA through Prypco Mint, a fractional property ownership offering. DLD isn’t a vendor, it’s a government department. The initiative was implemented in partnership with Prypco and in collaboration with various other regulatory agencies: https://dubailand.gov.ae/en/news-media/dld-launches-the-mena-s-first-tokenized-real-estate-project-through-the-prypco-mint-platform‍

It’s a crisp signal. The UAE is willing to put a consumer-facing tokenization project into the market, attached to known authorities and real investor flows. There’s both investor demand and regulatory readiness, making viable compliant onchain asset issuance in production environments.

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Supporting commercial zones and operators

A functioning tokenization ecosystem has many players, including licensed businesses, providers, and enough operational density that projects can hire expertise without rebuilding every function.

Dubai Multi Commodities Centre (DMCC) has been one of the organizing layers for this density through its Crypto & Blockchain Ecosystem, which has become a major commercial base for blockchain companies operating across the UAE and wider MENA region. DMCC’s own materials describe the ecosystem, membership base, and business setup pathway it offers to digital assets firms.

Ras Al Khaimah has also been formalizing its offer, publicly rebranding in September 2025 to Innovation City (formerly RAK Digital Assets Oasis). Innovation City positions itself as a free zone with focus areas including Web3 and digital assets.

Together, these zones provide workable environments, contractor pathways, and operational footing to further aid regulated tokenization initiatives in the UAE. 

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Implications for market and infrastructure operators

Tokenization becomes commercially interesting when it changes the cost and timing of real workflows. 

The ability to represent, move, and settle assets with fewer reconciliation breaks, shorter processing chains, and clearer control over who can hold and transfer an instrument is a major benefit – that’s why trade associations and research houses keep returning to collateral and capital markets plumbing. 

The Global Financial Markets Association (GFMA), alongside other trade associations, has published work on DLT in capital markets, tying tokenization to collateral mobility and operational efficiency.

‍S&P Global’s recent capital markets work also puts early scale in collateral operations and related workflows, where atomic exchange and improved intraday liquidity mechanics produce tangible benefits.

While forecasts are not plans, it’s worth noting that major banks and asset managers continue to publish tokenization market-size expectations in the multi-trillion range by 2030, influencing executive attention and budget allocation. A recent example from November 2025 is this guide by Deutsche Bank, whose ‘conservative’ estimate is for tokenized assets (excluding stablecoins) to reach the low trillions by 2030.

The practical implication is simple: the UAE isn’t waiting for this global shift, it’s leading it. By specifying pathways now, the UAE is shortening the gap between what’s potential and what’s producible, opening the door for these estimations to turn from abstract numbers to real results. 

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What’s next 

The UAE now represents a regulated, production-ready tokenization ecosystem, backed by clear licensing regimes, active regulatory oversight, and real-world deployments. 

As regulatory clarity increases, the volume and variety of compliant tokenized assets will increase with it. This growth won’t be absorbed by general-purpose technology, but will favour platforms compatible with regulatory frameworks from the outset. 

Polymesh was built for exactly this environment. Our focus on identity, compliance, and confidentiality aligns with markets where regulation and adoption are converging around long-term RWA tokenization. To learn more about Polymesh infrastructure, visit polymesh.network/about.