Key Points
- Tokenized private credit has surged to $13B, surpassing bonds and showcasing strong investor appetite.
- Cost and access barriers are breaking down with tokenization, democratizing private credit for wider participation.
- Major players like Invesco and Apollo are backing the shift, signaling growing institutional confidence.
BlackRock CEO Larry Fink once famously said that:
“The next generation for markets is tokenization.”
“Every stock, every bond, every fund, every asset can be tokenized.”
This shift is more evident than in the private credit market in comparison to any other Real World Assets (RWA) market, which has surged past tokenized bonds with $13 billion in active loans.
Why Tokenizing Private Credit is a Game Changer
Private credit, historically an illiquid asset class accessible primarily to institutional investors, is undergoing a transformation. Tokenization, converting private credit into blockchain-based digital tokens, brings several long-term advantages:
Cost Efficiency: Tokenization reduces administrative costs by up to 97% according to Centrifuge, a leading RWA (Real World Assets) platform, eliminating intermediaries and manual processing.
Liquidity: Traditionally locked-up assets can now be traded on secondary markets, offering flexibility and faster exit options for investors.
Transparency & Efficiency: Real-time settlement and performance tracking on-chain build investor trust and operational efficiency. Without a public market, loan values are often updated infrequently and rely on estimates or broker quotes until a major event occurs.
Broader Access: Fractional ownership democratizes private credit investing, allowing participation from retail investors previously. As private loans typically have high entry thresholds, with many funds requiring minimum commitments of $5–$10 million or higher.
Recent Data about Private Credit
- Market Growth: Since the beginning of the year, private credit has risen from $9 billion in active loans to over $13 billion.
- Real-World Assets: RWAs reached $22 billion by early 2025, with private credit taking the largest share, about 57.7%.
- Institutional Adoption: Major players like Invesco and Apollo Global Management have embraced tokenization for private credit.
- Leading Platforms: Pioneers such as Centrifuge, Maple, Tradable, and Figure are driving the tokenization of a wide range of credit instruments, from structured credit to real estate-backed loans. Keyrock, a market maker, projects the ultimate bull case for the private credit market at $17.5 billion. Currently valued at $13 billion, the market has grown by an impressive $4 billion in just five months, showcasing a rising investor appetite for tokenized private credit.
Institutional Adoption and Future Outlook
Tokenized private credit is no longer just a concept, it’s a thriving segment that has rapidly overtaken traditional tokenized bonds, with $24.5 billion in total loans and a $4 billion surge in just five months. As regulatory clarity improves, private credit tokenization is poised to unlock unprecedented access, efficiency, and transparency for investors.
