What is tokenised private credit?

What private credit is

The US Federal Reserve describes private credit as debt-like investments that are not publicly traded. They are provided by non-bank lenders, such as private credit funds, to fund private businesses.¹

The terms are usually agreed directly between one borrower and one lender, often called "direct lending".¹ Most of these loans have a floating rate. When market interest rates rise, borrowers have to pay more.¹

In 2025, the WEF said the global private credit market had passed $3 trillion in assets under management.³

Why it is harder than a Treasury bill

• Hard to sell. The Federal Reserve says private credit loans are illiquid, because there is no secondary market. Investors should expect to hold them to maturity, or take steep losses to get out early.¹
• Locked up. Private credit funds can lock up investors' money for as long as 10 years.¹
• Hard to see into. The Federal Reserve calls the sector relatively opaque, with scarce data.¹
• Less to recover. More than half of private credit goes to borrowers in sectors with few physical assets, such as software. So lenders tend to get back less after a default.¹

A real example of the layers

In January 2025, Apollo and Securitize launched ACRED, a tokenised way into Apollo Diversified Credit Fund.² That fund invests in direct loans to companies, asset-backed loans and other credit.²

ACRED is a feeder fund. It invests substantially all of its assets in the Apollo fund.² So there are layers: a token, a feeder fund, a credit fund, and then the loans themselves.²

The release said ACRED launched on six blockchains, including Ethereum and Solana. It said only qualifying investors could take part, through Securitize's broker-dealer, and that Securitize was ACRED's transfer agent.²

The release spoke of redemptions at a daily NAV, but did not say how much could be redeemed.² The Apollo fund underneath is a non-traded interval fund.² It offers to buy back shares only once a quarter, at least 5% of its shares each time, and there is no guarantee you can sell all you ask, its May 2026 prospectus says.⁴

An interval fund only buys back between 5% and 25% of its shares at each buyback, usually every three, six or twelve months.⁵

What is on-chain today

The WEF said in 2025 that most private loans on-chain were direct loans to institutional crypto investors. Most were backed by crypto, so a big fall in crypto prices could hurt the lenders.³ It said lending protocols such as Maple, Goldfinch and Centrifuge had driven more than $13 billion of on-chain loans.³

On 22 October 2026, RWA.xyz showed $8.14 billion of distributed tokenised credit, and $40.88 billion of represented credit.⁶ Its credit figures include private credit, on-chain lending, corporate credit and more.⁶