Credit on the Blockchain: A New Way to Invest
Securitize, a leader in tokenization, has introduced a new fund on the Ethereum network. The Securitize Tokenized AAA CLO Fund (STAC) focuses on collateralized loan obligations (CLOs), which are bundles of corporate loans divided into different risk levels. The safest, rated AAA, typically attract large investors.
Key Players and Investments
- BNY Mellon, a global financial services giant, is managing the fund's assets.
- Insight, a BNY subsidiary, is overseeing the investments.
- Grove, part of the DeFi protocol Sky (SKY), plans to invest $100 million in the fund.
Goal: Enhancing Accessibility and Efficiency
The fund aims to make credit products more accessible on the blockchain. Currently, these investments are often difficult to obtain or take a long time to settle. Tokenizing the fund's shares could streamline the process, making it easier to own a piece of the fund.
Industry Expert Insights
Jose Minaya, Global Head of BNY Investments and Wealth, believes tokenization offers efficiency and transparency, providing better access to high-quality credit.
Securitize's Growth and Future Plans
- Securitize has already issued $4.5 billion in tokenized assets, including equities and funds.
- They have a tokenized money market fund with BlackRock called BUIDL.
- The company plans to go public by merging with a Cantor Fitzgerald SPAC, potentially becoming the first U.S.-listed end-to-end tokenization firm.
The Rising Demand for Tokenized Real-World Assets (RWAs)
The market for tokenized real-world assets (RWAs) is expanding rapidly. BCG and Ripple predict it could reach $18.9 trillion by 2033, up from the current $35 billion. This new fund represents a significant step toward greater stability and accessibility for credit products on the blockchain.
