Tokenization expert Securitize has introduced a tokenized credit fund in collaboration with financial services titan BNY, as the demand for real-world assets (RWA) rises sharply.
The Securitize Tokenized AAA CLO Fund (STAC), which operates on the Ethereum network, seeks to provide on-chain investors with exposure to collateralized loan obligations (CLOs), as detailed in a press release issued on Wednesday.
BNY will serve as the custodian for the assets within the fund, while Insight, a BNY subsidiary specializing in fixed income and structured credit strategies, will manage the investments.
Grove, the on-chain capital allocator focused on credit within the DeFi protocol Sky (SKY), is planning to invest $100 million in the fund as its anchor investor, according to the release.
This offering aims to deliver one of the most reliable credit products on blockchain technology as the appetite for tokenized assets grows. BCG and Ripple have estimated that the market for tokenized real-world assets (RWA) may soar to $18.9 trillion by 2033, rising from the current $35 billion.
CLOs combine corporate loans into various risk-rated tranches. The most secure, AAA-rated tranches, offer floating-rate exposure that typically attracts institutional investors.
Traditionally, these investments have been challenging to access and slow to settle. Tokenizing the shares of the fund could transform this by enabling quicker settlements, better distribution, and simpler fractional ownership.
“For clients looking for yield, tokenization provides an excellent means to access high-quality credit through a transparent and efficient instrument,” remarked Jose Minaya, the global head of BNY Investments and Wealth.
Securitize has issued $4.5 billion worth of tokenized assets, including equities and funds, such as BlackRock’s tokenized money market fund BUIDL.
The company has announced its intention to go public by merging with a Cantor Fitzgerald SPAC, valuing the venture at $1.25 billion, with aspirations of becoming the first U.S.-listed end-to-end tokenization firm.
Read more: Tokenization Firm Securitize Aims for Public Listing Via SPAC Deal at $1.25B Valuation
