Mubadala & Kaio Launch Tokenized Fund Trial: Abu Dhabi’s Sovereign Wealth Giant Dives Deeper into Digital Assets

Abu Dhabi's $300 billion sovereign wealth fund is placing another strategic bet on blockchain's future.

Mubadala Investment Company is partnering with digital asset firm Kaio to pilot tokenized investment funds. The move signals a major institutional shift—transforming traditional private market stakes into programmable, on-chain assets.

Why Tokenization Isn't Just Hype

Forget NFTs of cartoon apes. This is about slicing private equity, venture capital, and real estate holdings into digital shares. Tokenization promises 24/7 settlement, automated compliance, and access to a global pool of capital—bypassing the usual fund admin bottlenecks.

It cuts middlemen, reduces costs, and could unlock trillions in currently illiquid assets. Even Wall Street's old guard is paying attention, though they'll probably slap a three-letter acronym on it and charge a 2% management fee anyway.

The Regulatory Green Light

Abu Dhabi's progressive financial authorities have been quietly building a sandbox for this exact scenario. The pilot operates within a clear regulatory framework, aiming to prove security, scalability, and interoperability with legacy systems.

Success here doesn't just mean a new product line—it redefines how institutional capital moves. Watch for other sovereign funds and pension giants to follow suit once the model is proven.

The future of finance isn't just digital—it's divisible, tradable, and transparent. And it's being built now, far from the noise of meme coins and speculative frenzy.

Mubadala’s scale and Kaio’s role

Mubadala Capital manages more than $430 billion across private equity, real estate, credit, and other alternative assets. As a part of the Abu Dhabi sovereign wealth fund, Mubadala Investment Company, it has the size of a state-backed organization and a focus on global alternative markets.

Kaio brings extensive experience in tokenizing funds for such large global managers as BlackRock, Brevan Howard, and Hamilton Lane. Kaio has moved over $200 million in institutional assets onto blockchain.

This partnership constitutes part of an increasing trend of traditional institutional capital considering routes into digital infrastructure without derogation from regulatory standards.

Mubadala Capital said the partnership with Kaio reflects its commitment to making institutional investment strategies more accessible. Fatima Al Noaimi and Max Franzetti, Co-Heads of Mubadala Capital Solutions, said the collaboration “enables new global access channels while maintaining the highest standards of governance, regulatory alignment, and investment oversight.

Kaio’s CEO, Shrey Rastogi, said the partnership shows how traditional institutional capital is starting to MOVE onto blockchain. “Mubadala Capital is leaning into the future of how real-world assets can be tokenized and made globally accessible without compromising compliance, governance, or investor protections,” he said.

Industry context

Mubadala Capital is joining a growing number of institutional investors exploring how blockchain can make private markets simpler and more accessible.

According to CoinShares, tokenized real-world assets posted strong growth in 2025, led by US Treasurys, which ROSE from $3.91 billion to $8.68 billion on-chain. This growth is expected to continue in 2026 as demand for dollar-denominated yields increases. Infrastructure providers are also getting ready for this trend.

Infrastructure providers are also preparing for this trend. For example, Polygon has launched its Madhugiri hardfork to make the network faster and more stable. Block times are now just one second, transaction capacity is higher, and new ethereum updates are added, including a special type for Ethereum–Polygon bridge transactions.

For Mubadala, this move is a key step toward modernizing private markets. It will give global investors easier access to large-scale, institutional-grade products while ensuring compliance with regulations.

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