Saudi Arabia publishes a tokenisation framework, and the perimeter is wider than expected

Saudi Arabia's central bank has published a tokenisation framework, and the perimeter it covers is wider than the market expected: it extends beyond government securities to private credit, money-market instruments, and structured products. The decision to set a wide perimeter at the outset is more consequential than the framework's technical details.

The conservative path would have been to tokenise government debt first, learn from the operational experience, and then widen the perimeter gradually. That is the path most jurisdictions have taken. Saudi Arabia has chosen to set the perimeter broadly from the start, which means that the standards it writes — for custody, settlement finality, transfer, and investor protection — have to be robust enough to accommodate instruments that are far harder to tokenise than a treasury bill.

The reason the wide perimeter matters is that it determines the kind of market that gets built. A narrow perimeter produces a tokenised government debt market — useful, but small. A wide perimeter produces a tokenised credit market, in which private loans, trade receivables, and structured instruments become transferable on-chain. That is a materially larger opportunity, and it is the one the kingdom has chosen to enable.

The risk is that writing standards broad enough to cover private credit is harder than writing standards for government debt, and that the framework will take longer to function as a result. The reward is that when it does function, the market it enables is the one that actually matters — a tokenised credit market that could, over time, reshape how capital is allocated and transferred in the region. The framework is ambitious. The ambition is the point.