With over $2.7 trillion in total market capitalization — having peaked above $3 trillion in July 2024 — Tadawul ranks as the 9th largest exchange globally among the 67 members of the World Federation of Exchanges and the largest in the MENA region. The exchange lists over 400 companies across its main market (239 on TASI) and Nomu parallel market, with average daily trading value reaching SAR 4.76 billion ($1.27 billion) in January 2026. Tadawul’s digital securities platform represents the most significant infrastructure development in Saudi Arabia’s capital markets since the exchange’s 2007 electronic trading system upgrade. Operational in pilot since Q2 2025, the platform integrates distributed ledger technology-based settlement with Tadawul’s existing multi-trillion-dollar market infrastructure. The platform supports tokenized sukuk, equity tokens, and digital bond trading, with T+0 atomic settlement capability that eliminates the settlement risk inherent in the current T+2 cycle. Three tokenized securities are currently listed on the platform in pilot mode, with a target of 15-20 listings by end of 2027.
Platform Architecture
Tadawul’s digital securities platform operates as a parallel market integrated with the exchange’s core infrastructure:
Trading Layer: The platform extends Tadawul’s existing X-Stream INET trading engine to handle digital securities orders. Orders for tokenized securities flow through the same matching engine as conventional securities, ensuring consistent price discovery, surveillance, and market data distribution. This integration means digital securities benefit from Tadawul’s established market microstructure, including:
- Continuous auction trading with price-time priority
- Market maker obligations for designated digital securities
- CMA market surveillance coverage
- Real-time market data dissemination
Settlement Layer: The settlement innovation is the platform’s primary differentiator. While conventional Tadawul settlement operates on a T+2 cycle through Edaa, the digital securities platform offers T+0 atomic settlement:
- Trade execution and settlement occur simultaneously
- Delivery-versus-payment (DvP) is enforced at the protocol level — tokens and payment are exchanged atomically
- Settlement finality is immediate, eliminating counterparty risk during the settlement window
- Digital riyal or SAR stablecoins serve as the payment leg for atomic settlement
Custody Layer: Edaa serves as the central custody provider for exchange-listed digital securities, maintaining the registrar function while integrating blockchain-based record-keeping. Investors may also hold digital securities at CMA-licensed third-party custodians, with settlement finality confirmed once Edaa records the transfer.
Compliance Layer: Embedded compliance functions include:
- KYC/AML verification for all participants through integration with the CMA’s digital asset framework
- Real-time transaction monitoring and suspicious activity detection
- Sharia compliance verification for Islamic digital securities
- Automated disclosure filing triggers for material events
Technology Stack
The platform’s technology stack reflects Tadawul’s preference for proven, enterprise-grade infrastructure:
Blockchain Protocol: R3 Corda Enterprise, selected for its:
- Point-to-point transaction architecture (only parties to a transaction see its details, not the entire network)
- Enterprise support and SLA guarantees
- Compatibility with existing financial messaging standards (ISO 20022)
- Regulatory compliance features including identity verification and transaction reversibility
- Saudi Arabia data residency compliance (all nodes operate within the Kingdom)
Tadawul, in partnership with the Saudi Blockchain Lab, evaluated seven blockchain protocols over a 12-month period against the CMA’s technical assessment criteria before selecting Corda. The evaluation considered Ethereum (rejected for privacy limitations in the current public deployment model), Hyperledger Fabric (strong contender but less mature for securities use cases), and Hedera Hashgraph (innovative but lacking enterprise support history).
Smart Contract Framework: CorDapps (Corda Distributed Applications) implementing:
- Token issuance and lifecycle management
- DvP settlement logic
- Corporate action processing (dividends, coupons, splits)
- Compliance rule enforcement (investor suitability checks, holding limits, trading restrictions)
- Sharia compliance automation (purification calculations, screen monitoring)
Integration Architecture: RESTful APIs connecting the digital securities platform to:
- Tadawul X-Stream INET trading engine
- Edaa CSD systems
- SAMA real-time gross settlement (SARIE)
- CMA regulatory reporting systems
- Broker-dealer order management systems (12 brokers currently connected)
- Open banking payment initiation services
Current Listings (Pilot Phase)
Three tokenized securities are listed on the platform in pilot mode:
Tokenized Government Sukuk (SAR 500M):
- Issuer: A CMA-licensed investment bank acting on behalf of the Ministry of Finance
- Structure: Tokenized ijara sukuk backed by Saudi government assets
- Coupon: Quarterly distribution based on underlying asset performance
- Investors: Institutional investors only during pilot
- Settlement: T+0 atomic settlement in SAR
Tokenized Corporate Sukuk (SAR 350M):
- Issuer: A major Saudi corporation through a CMA-licensed digital asset issuer
- Structure: Tokenized murabaha sukuk
- Tenor: 5 years with semi-annual distributions
- Investors: Qualified investors only
- Settlement: T+0 atomic settlement
Tokenized Equity Fund (SAR 200M):
- Issuer: A CMA-licensed fund manager
- Structure: Tokenized units in a Sharia-compliant Saudi equity fund
- NAV: Calculated and published daily on-chain
- Investors: Qualified and semi-qualified investors
- Settlement: T+0 with NAV-based pricing
Participant Network
The pilot phase includes:
- 12 broker-dealers connected to the platform for order routing
- 3 market makers providing liquidity for listed digital securities
- 2 custodians (Edaa plus one CMA-licensed third-party custodian)
- 1 settlement bank providing SAR payment rail for atomic settlement
- 47 institutional investors registered for pilot participation
Roadmap
Tadawul’s digital securities platform roadmap:
2026 H2: Expand pilot to 8-10 listed digital securities, including the first tokenized equities (direct company tokenization rather than fund tokenization). Begin retail investor access for selected securities meeting CMA retail investor criteria.
2027: Target 15-20 listed digital securities. Introduce cross-listing framework for digital securities listed on other GCC exchanges. Launch digital securities index products. Integrate digital riyal as settlement currency alongside private stablecoins.
2028: Full production launch. Merge digital securities platform with conventional trading infrastructure, eliminating the distinction between tokenized and conventional securities at the exchange level. Target SAR 50 billion in digital securities market capitalization.
The integration of digital securities into Tadawul’s mainstream infrastructure represents the CMA’s ultimate regulatory objective — a unified capital market where the settlement technology (conventional versus DLT) is an implementation detail rather than a regulatory distinction.
Platform Economics
The digital securities platform generates revenue through several channels:
Trading Fees: Tadawul charges 0.8 basis points per side for digital securities transactions, compared to 1.2 basis points for conventional securities. The reduced fee reflects both the lower marginal cost of DLT-based settlement and Tadawul’s strategic interest in incentivizing early digital securities adoption.
Listing Fees: Annual listing fees for digital securities range from SAR 50,000 to SAR 200,000 depending on market capitalization, comparable to conventional Tadawul listing fees. The fee structure is designed to avoid creating a cost barrier that would discourage issuers from choosing tokenization.
Data Fees: Real-time and delayed digital securities market data is distributed through Tadawul’s existing data feed infrastructure, with pricing consistent with conventional market data products. On-chain settlement data is publicly accessible but commercial redistribution requires a Tadawul data license.
Technology Services: Tadawul offers optional technology services to issuers and participants including smart contract deployment support, Sharia compliance automation tools, and regulatory reporting integration. These services generate SAR 5-15 million annually during the pilot phase.
Revenue Projections: Tadawul projects digital securities platform revenue of SAR 30-50 million annually by 2027, growing to SAR 200-500 million by 2030 as listing volume increases and the platform captures a larger share of Saudi securities trading activity. At full convergence, all Tadawul revenue — approximately SAR 1.5 billion annually — would flow through DLT-enabled infrastructure.
Operational Resilience
The digital securities platform meets the highest operational resilience standards:
System Availability: The 99.98% system availability achieved during the initial pilot period translates to approximately 105 minutes of total downtime annually. The target for full production is 99.99% (approximately 52 minutes annually), matching the availability standard of SAMA’s SARIE real-time gross settlement system.
Disaster Recovery: The platform operates across three data centers (Riyadh primary, Jeddah secondary, Dammam disaster recovery) with automatic failover. Recovery time objective (RTO) is 15 minutes; recovery point objective (RPO) is zero (no data loss) due to synchronous replication across sites.
Cyber Security: The platform is classified as critical national infrastructure under the National Cybersecurity Authority framework. Security measures include hardware security modules (HSMs) for all cryptographic operations, network segmentation isolating the DLT nodes from general IT infrastructure, 24/7 security operations center monitoring, and quarterly penetration testing by CMA-approved cybersecurity firms.
Stress Testing: SAMA requires annual stress testing of the settlement infrastructure, simulating scenarios including 10x peak volume surges, simultaneous market maker withdrawal, network partition events, and coordinated cyber attacks. The 2025 stress test results confirmed that the infrastructure can sustain 3,400 TPS (10x current peak) without performance degradation.
Participant Onboarding
New participant onboarding to the digital securities platform follows a structured process:
Broker-Dealer Onboarding: CMA-licensed broker-dealers must complete technical integration testing, compliance staff certification, and operational readiness assessment. The onboarding process takes 8-12 weeks and includes integration with Tadawul’s test environment for simulated trading and settlement.
Institutional Investor Registration: Qualified investors must register through their broker-dealer, with AML/CFT verification and wallet provisioning. Registration processing time is 5-10 business days.
Market Maker Qualification: Entities seeking designated market maker status must demonstrate minimum SAR 100M in available trading capital, existing market-making operations on Tadawul or equivalent international exchanges, and DLT settlement operational capability. The qualification process takes 4-8 weeks with CMA approval.
International Connectivity
The platform’s international connectivity strategy targets three dimensions:
GCC Exchange Interoperability: Technical discussions are underway with Abu Dhabi Securities Exchange (ADX), Dubai Financial Market (DFM), and Bahrain Bourse for cross-border digital securities trading. The vision is mutual listing of tokenized securities — a sukuk tokenized and listed on Tadawul could simultaneously trade on ADX, with atomic cross-border settlement between the exchanges’ DLT systems.
International Custody Network: The platform connects to 4 international custodian banks through API integrations, enabling international institutional investors to hold Saudi digital securities through their existing custody relationships. The cross-border custody framework ensures that international custody arrangements meet Saudi CMA standards while complying with home-jurisdiction requirements.
FTSE/MSCI Integration: Tadawul is engaging with index providers (FTSE Russell, MSCI) on the inclusion of tokenized securities in Saudi Arabia index calculations. Currently, tokenized securities are excluded from index calculations due to insufficient float and liquidity history. The target is index inclusion by 2028, which would trigger passive investment flows from index-tracking funds.
Issuer Listing Process: Issuers submit listing applications to Tadawul’s Digital Securities Listing Committee, providing the Digital Asset Prospectus, smart contract audit reports, Sharia certification (if applicable), and evidence of custody arrangements. Listing approval takes 15-30 business days for private placement transitions and 30-60 business days for new public offerings.
The Tadawul digital securities platform is not merely a technology project — it is the operational center of Saudi Arabia’s entire tokenization ecosystem. Every tokenized sukuk, equity token, bond token, and commodity token that reaches the secondary market trades and settles through this infrastructure. The platform’s success determines whether Saudi Arabia’s tokenization ambition remains a regulatory vision or becomes a functioning market reality. With SAR 4.2 billion in pilot settlement volume, 3 listed instruments, and 47 institutional participants, the platform has demonstrated production viability. The path from pilot to the $2.7 trillion fully converged exchange is the defining challenge of Saudi capital markets for the remainder of this decade.
The platform’s significance extends beyond technology. It embodies Saudi Arabia’s Vision 2030 ambition to build a top-10 global financial center — a vision backed by concrete progress, with 57% of Vision 2030’s core KPIs on track or ahead of schedule and the Public Investment Fund crossing $1 trillion in assets under management in 2025. By integrating DLT settlement into the Kingdom’s national exchange rather than creating a separate digital exchange (as Switzerland, Singapore, and Hong Kong have done), Tadawul is betting that the future of capital markets is not digital-versus-traditional but digital-as-default. That bet, backed by the CMA’s regulatory framework, SAMA’s payment infrastructure, and the Kingdom’s institutional commitment, positions Tadawul to become the most technologically advanced major exchange globally by 2030. A landmark reform effective February 1, 2026 abolished the Qualified Foreign Investor (QFI) concept entirely, opening Tadawul to all categories of foreign investors — including retail — without qualification requirements for the first time, with foreign holdings already reaching SAR 376.94 billion ($100.52 billion) in January 2026. The combined Tadawul market capitalization of over $2.7 trillion — larger than the London Stock Exchange’s domestic listings — provides the scale to make this ambition economically viable.
The platform’s compliance infrastructure incorporates Saudi Arabia’s FATF membership obligations, with real-time blockchain analytics monitoring all transactions for suspicious activity patterns. The AML/CFT framework applicable to the digital securities platform reflects the same standards applied to conventional Tadawul trading, ensuring that the shift to DLT settlement does not create compliance gaps. International institutional participants benefit from the FATF’s peer review process, which provides independent assurance that Saudi Arabia’s financial crime prevention standards meet global benchmarks across both conventional and digital market infrastructure.
For Tadawul digital securities platform inquiries: info@sauditokenisation.com