Cracks in the global private credit market are rattling investors, raising concerns that stress could spill over into crypto markets.
Bloomberg reported Friday that BlackRock’s $26 billion private credit fund has begun limiting withdrawals due to rising redemption requests. The move follows similar stress at Blue Owl, which sold $1.4 billion in loans last month to meet withdrawals and reportedly has exposure to a collapsed UK property lender.
Shares of major asset managers including BlackRock ( BLK ), Apollo Global Management ( APO ), Ares Management ( ARES ) and KKR fell 4%-6% on Friday, extending their 2026 route.
Read more: Blue Owl liquidity crisis has investors bracing for 2008-like fallout
If the redemption pressure forces private credit funds to unwind positions, it could trigger a broader deleveraging across asset classes that could ripple through digital assets, including bitcoin warned Andreja Cobeljic, head of derivatives trading at Swiss crypto bank AMINA Bank in an email.
Credit stress meets energy shock
U.S. banks provided nearly $300 billion in loans to private credit providers by mid-2025 and another $285 billion to private equity funds, Cobeljic wrote, with the risk that credit problems could extend to the banking sector
“In isolation, this would be manageable,” he said. “But emerging in the middle of a broader global deleveraging event, along with an energy shock and collapsing interest rate cut expectations, that’s a different conversation.”
“For risk assets, including crypto, a disorderly relaxation here would represent a significant second-order shock that current pricing does not reflect,” he said.
Contagion to tokenized asset markets
Another channel of credit risk may appear directly on blockchain rails.
Tokenized private credit products—loans and funds packaged and issued on public blockchains as tokens—have grown rapidly as part of the broader real-world asset (RWA) trend. According to data from rwa.xyz, the private credit market in the chain now stands at just under $5 billion. That’s still small compared to the global private credit market of about $3.5 trillion by 2025, estimated by the Alternative Credit Council.
But the growing presence of these assets in decentralized finance (DeFi) means that stress in the underlying loans can spill over directly to the crypto markets.
“Institutions are entering crypto, but often with products that even degenerates and DeFi natives don’t fully understand,” said Teddy Pornprinya, co-founder of real-world asset protocol Plume.
Real-world credit products can carry complex risks that aren’t always obvious to crypto investors, he said, including volatile net asset value fluctuations and overall returns that don’t fully reflect fees or credit risk.
A recent episode shows how off-chain credit stress can spill over into DeFi.
According to a report by risk advisory firm Chaos Labs, First Brands Group’s bankruptcy in 2025 affected a private credit strategy run by Fasanara Capital. A tokenized version of the strategy, mF-ONE, had been issued on the Midas RWA platform and used as collateral for loans on the Morpho protocol.
As the underlying fund downgraded exposure linked to the bankruptcy, the token’s net asset value fell around 2%, pushing highly leveraged borrowers close to liquidation and tightening liquidity on the platform. Lenders ultimately avoided losses, but the episode highlighted how tokenized private credit used as DeFi collateral can transfer traditional credit stress to on-chain markets.
