First Abu Dhabi Bank (FAB) has entered into a Memorandum of Understanding (MoU) with Libre Capital, a tokenization specialist supported by WebN Group and Nomura’s Laser Digital, to explore blockchain-based collateralized lending using real-world asset (RWA) tokens.
Since its launch in March, Libre has tokenized approximately $150 million worth of assets, including Brevan Howard funds, Hamilton Lane’s fixed-income products, and a BlackRock money-market fund. Under the MoU, First Abu Dhabi Bank will pilot a credit line allowing approved lenders to offer stablecoin loans using these tokens as collateral.
Crypto asset holders are increasingly leveraging their tokens as collateral for loans. Libre, which proposed its blue-chip RWA tokens as collateral on a MakerDAO forum in September, has now brought FAB, a $335 billion financial institution, into the fold. The bank will manage liquidity by providing credit lines secured against Libre’s assets on public blockchains such as Ethereum, Polygon, Solana, NEAR, Aptos, and Coinbase’s Layer 2 network BASE.
Libre’s collateralized lending solution is part of its “Project HODL” initiative, which stands for High-Yield Optimized Decentralized Liquidity.
“We’ve been working on adding utility to our AUM in the form of collateralized lending,” explained Dr. Avtar Sehra, founder and CEO of Libre. “Essentially, it’s an on-chain infrastructure that allows these RWAs to be used as collateral. The lending is all in stablecoins, not in fiat, and is being provided through existing lenders, like broker-dealers or Laser Digital. Now they are getting credit lines from providers like FAB.”
At the MoU signing event in the United Arab Emirates, Sameh Al Qubaisi, Group Head of Global Markets at FAB, emphasized the bank’s commitment to fostering innovation in the region.
“Through this initiative, FAB aims to enable secure credit facilities backed by tokenized assets, with automated processes ensuring robust risk management and complete regulatory compliance,” he stated.
