KAIO, a tokenization firm regulated by Abu Dhabi, announced on Monday that it has secured $8 million in a strategic funding round, with Tether and several other prominent crypto and institutional investors participating. This investment brings KAIO's total funding to $19 million, with new investors such as Systemic Ventures joining, and existing backers like Further Ventures, Laser Digital, and Brevan Howard Digital also participating.

KAIO is focused on developing infrastructure that enables asset managers to distribute their funds on the blockchain. The company has created tokens for products from well-known firms like BlackRock, Brevan Howard, and Hamilton Lane, making them accessible through blockchain-based systems.

With this new investment, KAIO plans to expand its offerings to include credit, structured investments, and exchange-traded funds. The firm is also set to launch an on-chain fund in collaboration with Mubadala Capital, a private equity firm based in the UAE with $385 billion in assets under management. By tokenizing institutional funds, KAIO aims to reduce the barriers to entry for investors, with minimum investments starting at $100 for eligible users, significantly lower than the typical thresholds for institutional funds.

Tether's involvement in this funding round highlights the potential for stablecoin flows to be channeled into regulated investment products. As the most widely used stablecoin with a supply of $185 billion, USDT is often utilized for cross-border transactions, particularly in emerging markets. KAIO seeks to tap into this liquidity and direct it towards regulated investment products. According to Tether CEO Paolo Ardoino, 'KAIO's unique position unlocks new pathways for capital formation and investment by bringing institutional-grade assets on-chain and making them more broadly accessible, which helps expand participation in global financial markets.' KAIO's platform incorporates compliance into its system and supports regulated distribution frameworks in various jurisdictions, including Abu Dhabi, the Cayman Islands, and Singapore.

To date, the company has tokenized approximately $100 million in assets and processed over $500 million in transactions.