FAB Activates Digital Asset Financing Framework With Komainu

First Abu Dhabi Bank (FAB) has operationalized a key component of its institutional digital asset financing infrastructure after completing two-way transfers of a digital asset portfolio through regulated custodian Komainu, demonstrating its ability to move assets into and out of custody for potential use as collateral in financing transactions.

Announced on November 3, the transfers settled instantaneously and put into operation the custody and connectivity framework established between FAB Global Markets and Komainu. The infrastructure enables digital asset portfolios to be transferred into regulated custody and subsequently moved out, supporting their use in institutional financing arrangements.

According to FAB, its digital asset financing capabilities are already available to institutional clients, with the bank now working towards its first transactions. Neither institution disclosed the value or composition of the transferred portfolio.

FAB Builds Infrastructure for Digital Asset-Backed Financing

The operational framework is designed to support financing transactions backed by digital assets held in regulated custody. One of the potential applications identified by FAB is digital asset-backed repurchase agreements (repos), in which assets are transferred as collateral under an agreement to reverse the transaction at a later date.

The ability to move assets in both directions is an important component of this infrastructure, allowing digital asset portfolios to enter a custody environment and subsequently be released or transferred as required by financing arrangements.

FAB said the successful transfers validated the infrastructure needed to support institutional digital asset financing, integrating Komainu's regulated custody and connectivity capabilities with the bank's existing systems.

The announcement marks a further development in FAB's exploration of blockchain-based collateral and lending. In December 2024, the bank partnered with Libre Capital to explore collateralised lending using tokenised real-world assets, including a proposed credit facility supporting loans backed by tokenised fund assets.

Komainu Integrates Regulated Custody Into FAB's Banking Infrastructure

For Komainu, the completion of the transfers demonstrates how institutional digital asset custody can be integrated into a traditional bank's existing operational framework, including its governance, controls and workflows.

Paul Frost-Smith, Group Managing Director of Komainu, said the transfers showed that regulated custody could operate within a bank's existing systems as part of its day-to-day operations.

He added that Komainu would support FAB as it develops its institutional offering, including financing backed by assets held in segregated, regulated custody.

Komainu is backed by Laser Digital and Blockstream and operates across several jurisdictions, including the UAE. Its Dubai entity, Komainu MEA FZE, is regulated by the Virtual Assets Regulatory Authority (VARA).

The custodian previously received its VARA operational license in August 2023, enabling it to provide regulated custody services to institutional clients in Dubai.

Part of FAB's Broader Digital Asset Programme

The development adds a financing and custody component to FAB's wider digital asset programme, which has included initiatives involving tokenised deposits and blockchain-based capital markets infrastructure.

In September 2026, FAB and Citi completed 24/7 USD payment transactions using tokenised deposits through Swift's blockchain-based ledger infrastructure, demonstrating another application of distributed ledger technology within the bank's institutional operations.

FAB has also participated in the issuance of MENA's first digitally native green bond through Euroclear's D-FMI platform, alongside Abu Dhabi Securities Exchange and HSBC.

Together, these initiatives reflect FAB's efforts to integrate digital assets into different areas of institutional banking, extending beyond payments and tokenization to custody, collateral management and financing.

With the custody framework now operational, the next milestone will be the execution of FAB's first digital asset-backed financing transactions, which would demonstrate how the infrastructure can be used in commercial institutional activity.