Tokenized Real-World Assets

Tokenized Private Credit

Fractional credit/debt invested via tokens.

Investment Overview

Tokenized private credit brings middle-market loans on-chain, offering 7-12% yields through fractional ownership of institutional-grade debt. Leading platforms: Maple Finance ($600M lent), Centrifuge ($400M financed), Goldfinch ($100M deployed). Unlike tokenized Treasuries, private credit carries default risk but offers significant yield premiums (300-700bps over Treasuries). Loans typically senior secured with LTVs 50-70%. Borrowers: FinTech lenders, crypto market makers, SMEs. Average loan terms: 6-24 months. This is higher risk than Treasuries but provides uncorrelated yields and exposure to private credit markets previously accessible only to institutions.

Market Context & Trends

Tokenized private credit exploded during 2023 rate hikes as investors sought high yields. Maple Finance dominated with $600M in loans but faced $40M+ defaults (2022) from crypto borrowers (Orthogonal Trading, M11 Credit). Response: Tightened underwriting, shifted to real-world borrowers (FinTechs, SMEs). Centrifuge pioneered real-world asset tokenization with invoices, mortgages, consumer loans. Goldfinch focused on emerging market lending (8-15% yields) with 95%+ repayment rates. Default rates: 2-5% for quality platforms vs. 8-12% during 2022 crypto crisis.

How to Invest in Tokenized Private Credit

Maple Finance Cash Management: Senior secured loans to FinTechs, 5-7% yield, $100K minimum

Maple Crypto Credit: Loans to institutional crypto borrowers, 8-10% yield, $100K minimum

Centrifuge Pools: Tokenized invoices, mortgages, consumer loans, 6-12% yields, $1K-$10K minimums

Goldfinch Senior Pool: Emerging market lending, 9-12% yield, $100 minimum, higher default risk

Credix: Latin America SME credit, 10-14% yield, $10K minimum, currency risk

Key Platforms & Access Points

Maple Finance: Leading DeFi credit protocol, $1B+ originated, institutional borrowers

Centrifuge: RWA pioneer, tokenized invoices and mortgages, Centrifuge Prime for institutions

Goldfinch: Emerging market focus, decentralized credit scoring, backed by a16z

Credix: Latin America SME lending, local originator partnerships, 10-14% yields

TrueFi: Uncollateralized lending protocol, credit scoring model, shifted to private credit 2023

Key Investment Metrics

Default rate: 2-5% acceptable for private credit; >8% = poor underwriting

LTV (Loan-to-Value): Senior secured loans typically 50-70% LTV; lower = safer

Borrower diversification: Single borrower >20% of pool = concentration risk

Average loan duration: 6-24 months typical; longer = more interest rate risk

Recovery rate: In default scenarios, senior secured typically recovers 60-80% vs. 20% unsecured

Risk Considerations

Understanding these risks is critical before investing in tokenized private credit.

Default risk: 2-5% annual defaults typical; 2022 saw 8-12% during crypto crisis
Platform risk: If Maple/Centrifuge insolvent, recovery process unclear despite loan segregation
Borrower concentration: Some pools have 40-60% exposure to single borrower; binary outcomes
Interest rate risk: Fixed-rate loans lose value when rates rise; floating preferred
Liquidity: Most loans lock capital 6-24 months; secondary market thin (<$1M daily volume)

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