A large-scale diamond tokenization initiative in the United Arab Emirates has surpassed $280 million in on-chain value, marking one of the most significant real-world asset deployments in the region to date. The project involves the digitization of certified polished diamonds held in Dubai, with token issuance linked directly to physical inventory secured through institutional custody infrastructure.
More than AED 1 billion worth of diamonds have already been recorded on a blockchain network, demonstrating early traction for tokenized commodities within a regulated financial hub. The initiative is designed to improve settlement efficiency and enhance traceability across the diamond supply chain.
Custody Infrastructure and Blockchain Layer
The underlying custody and tokenization framework is supported by enterprise-grade digital asset custody technology, while the blockchain network is used to mint and transfer tokens representing ownership of individual stones. This setup places the technology provider at the infrastructure level, rather than operating as a marketplace or exchange.
Industry observers note that while token creation and custody are well established, the commercial success of tokenized diamonds will depend on secondary market functionality, including liquidity, transparent pricing, and enforceable redemption rights tied to the physical assets.
Regulatory Approval and Market Readiness
Further expansion of the platform remains subject to regulatory approval from Dubai’s virtual asset regulator. A broader rollout would require clear guidelines on trading, redemption mechanisms, and minimum transaction sizes.
The project aligns with Dubai’s wider strategy to position itself as a global center for real-world asset tokenization, with local commodity authorities facilitating collaboration between technology providers and traditional asset firms.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.