KAIO, a tokenization firm regulated by Abu Dhabi, announced on Monday that it had secured $8 million in a strategic funding round supported by Tether and several other prominent crypto and institutional investors. This investment will enable the company to develop infrastructure for bringing traditional funds onto blockchain rails.
The funding round brings KAIO's total investment to $19 million, with new investors such as Systemic Ventures and returning investors like Further Ventures and Laser Digital. The company is also backed by earlier investors, including Brevan Howard Digital.
KAIO is dedicated to creating infrastructure that allows asset managers to distribute funds on the blockchain. It has developed 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 company intends to launch an on-chain fund in collaboration with Mubadala Capital, an Emirati private equity firm 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 investment ties the model to stablecoin flows, with USDT being the most widely used stablecoin, boasting a $185 billion supply, often utilized for cross-border transactions, especially in emerging markets.
KAIO seeks to channel this liquidity into 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, helping expand participation in global financial markets." KAIO's platform incorporates compliance into its system and supports regulated distribution frameworks, including those in Abu Dhabi, the Cayman Islands, and Singapore. The company has tokenized approximately $100 million in assets and processed over $500 million in transactions.