Abu Dhabi’s Mubadala Capital has launched an exploratory partnership with KAIO to evaluate on-chain RWAs, aiming to test tokenized access to private-market investment strategies for qualified institutional and accredited investors. The initiative is structured as a proof-of-concept to assess KAIO’s compliant infrastructure and its suitability for institutional allocation into tokenized private assets.
Institutional proof-of-concept for tokenized private markets
Mubadala Capital’s engagement is a deliberate technical and commercial assessment of how a purpose-built RWA platform can enable regulated, digital access to private equity, private credit and other illiquid strategies. The work will focus on operational and compliance integration rather than immediate product launches, explicitly testing whether KAIO’s framework can support institutional-grade tokenized fund structures while preserving governance and investor protections.
Mubadala Capital is a large alternative investment platform that manages, advises and administers approximately $430 billion in assets through its subsidiaries and partnerships. The partnership targets pathways to fractional ownership and improved liquidity for private-market exposures while keeping allocation decisions firmly within existing institutional mandates and risk frameworks.
KAIO operates a sovereign AppChain designed for compliant tokenization and on-chain fund mechanics, incorporating features such as intelligent routing, liquidity aggregation and LayerZero OFT compatibility to support cross-chain movement. Its regulatory alignment with the UAE’s Virtual Assets Regulatory Authority (VARA) is positioned as a core differentiator intended to embed permissioning and compliance at the protocol level.
KAIO has already supported institutional tokenization efforts and has brought over $200 million of institutional assets on-chain, with $108.5 million in assets under management across four products in a concentrated rollout window. In this context, tokenization means converting ownership or economic claims on physical or private-market assets into digital tokens that can be transferred and settled on a distributed ledger.
“This launch demonstrates how traditional institutional capital is now scaling on-chain,” said Shrey Rastogi, CEO of KAIO.
The proof-of-concept explicitly acknowledges material legal, technical and liquidity risks inherent to RWA tokenization, including cross-jurisdictional legal recognition of token ownership, custody and settlement mechanics, oracle integrity, smart-contract vulnerabilities, platform interoperability and constrained secondary liquidity. Regulatory supervision through VARA and an AppChain architecture are presented as mitigants intended to narrow legal ambiguity and reduce attack surface compared with general-purpose blockchains.
Market data cited in the review frame RWA tokenization as a rapidly expanding segment, with total value locked reported as having passed $50 billion in 2025 and some projections estimating the tokenizable market could scale to about $16 trillion by 2030, with institutional participants already representing a majority share. These figures explain why large asset managers and sovereign-linked investors are testing tokenization infrastructure now, even at a proof-of-concept stage.
The Mubadala–KAIO collaboration is a measured, technical probe into whether a compliant AppChain can reconcile institutional governance with on-chain operational benefits. Its success will depend on demonstrable pilots that validate custody, KYC/AML arrangements and secondary-liquidity mechanics under institutional due-diligence standards.
