RWA news: Tether backs UAE tokenization firm KAIO in $8M funding round

Abu Dhabi-regulated tokenization firm KAIO said Monday it raised $8 million in a strategic funding round led by Tether and a group of crypto and institutional investors, bringing the company's total capital raised to $19 million. KAIO, which builds infrastructure to let asset managers tokenize and distribute institutional funds on blockchain rails, said the round will finance expansion into credit, structured products and exchange-traded funds, the launch of an onchain fund with Mubadala Capital, and efforts to channel USDT stablecoin 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.

Deal details and investors

KAIO named Tether as a backer in the strategic round and said new investors include Systemic Ventures. Existing backers Further Ventures and Laser Digital participated again, and Brevan Howard Digital was also listed among early supporters. The company, headquartered in Abu Dhabi, said the funding will support product development and regulatory integrations intended to broaden investor access to institutional funds via tokenization.

• Round size: $8 million; total funding to date: $19 million
• New investor: Systemic Ventures; returning investors: Further Ventures, Laser Digital; earlier backer: Brevan Howard Digital
• Targeted product expansion: credit, structured investments, ETFs
• Planned partnership: onchain fund with Mubadala Capital (reported $385 billion in assets under management)

Product scope, metrics and compliance

KAIO said it packages tokens of institutional products from firms such as BlackRock, Brevan Howard and Hamilton Lane and distributes them through blockchain-based systems. The company emphasized a low minimum investment threshold—targeting eligible users with entry points starting at $100—to lower barriers compared with typical institutional fund minimums.

Operational metrics supplied by KAIO include approximately $100 million in assets tokenized to date and more than $500 million processed in transactions. The firm also highlighted compliance features built into its platform, noting support for regulated distribution frameworks in Abu Dhabi, the Cayman Islands and Singapore.

Outlook

KAIO framed Tether's participation as a bridge between stablecoin liquidity and regulated investment vehicles. USDT, the most widely used stablecoin, has a reported supply of about $185 billion and is commonly used to move capital across borders—particularly in emerging markets. KAIO said it aims to channel that liquidity into regulated products, a move that could funnel stablecoin capital into tokenized funds distributed under established regulatory regimes.

The funding and planned product expansions position KAIO to pursue broader institutional partnerships and to develop new tokenized instruments, including credit and structured offerings and ETFs, while the announced Mubadala Capital onchain fund signals interest from major regional asset managers in onchain distribution models.