Tether backs UAE tokenization firm KAIO in $8M funding round to bring Emirati funds onchain

The Abu Dhabi regulated firm build infrastruture to distribute insitutional funds on blockchain rails, lowering entry barrier for investors.

What to know:

• Abu Dhabi-regulated tokenization firm KAIO raised $8 million in a strategic round led by Tether and other crypto and institutional investors, bringing its total funding to $19 million.
• KAIO builds infrastructure that lets asset managers tokenize and distribute institutional funds on blockchains, packaging products from firms such as BlackRock, Brevan Howard and Hamilton Lane with minimum investments starting at $100.
• The company plans to expand into credit, structured products and ETFs, launch an onchain fund with Mubadala Capital, and channel USDT stablecoin liquidity into regulated investment products, while managing about $100 million in assets and having processed more than $500 million in transactions.

Abu Dhabi-regulated tokenization firm KAIO said Monday it had raised $8 million in a strategic funding round backed by Tether and several other crypto and institutional investors, as it builds infrastructure to bring traditional funds onto blockchain rails.

The round brings KAIO’s total funding to $19 million. New investors include Systemic Ventures, while Further Ventures and Laser Digital joined again alongside earlier backers such as Brevan Howard Digital.

KAIO said it develops infrastructure that allows asset managers to distribute funds onchain. It packages products from firms like BlackRock, Brevan Howard and Hamilton Lane, then makes them accessible through blockchain-based systems.

With the investment, KAIO plans to expand into other products such as credit, structured investments and exchange-traded funds. The firm said it plans to launch onchain fund with Mubadala Capital, the Emirati private equity firm with $385 billion in assets under management.

By creating tokens of institutional funds, the firm said its goal is to lower investor barriers to entry. KAIO targets minimum investments starting at $100 for eligible users, far below the typical thresholds for institutional funds.

Tether's involvement ties the model to stablecoin flows. USDT is the most popular stablecoin, boasting a $185 billion supply, and is often used to move money across borders, especially in emerging markets. KAIO aims to channel that liquidity into regulated investment products.

"KAIO’s unique position unlocks new pathways for capital formation and investment by bringing institutional-grade assets onchain and making them more broadly accessible, helping expand participation in global financial markets," Tether CEO Paolo Ardoino said in a statement.

KAIO said its platform embeds compliance into its system and supports regulated distribution frameworks, including those in Abu Dhabi, the Cayman Islands and Singapore.

The company said it manages about $100 million in assets and has processed more than $500 million in transactions.

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The talks do not involve any sort of stake acquisition or similar deal to enter the U.S., as was reported elsewhere last month.

What to know:

• Discussions between Coinbase and Bybit focus on the global distribution and custody of tokenized stocks and other assets.
• Bybit's plan to enter the U.S. market involves an unidentified local partner, which is not Coinbase.

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