Dubai, UAE-tokenization company Securitize and Decentralized Finance (Defi) Specialist Gauntlet plans to bring a tokenized version of Apollo’s credit fund to Defi, a remarkable step in embedding assets in the real world in the crypto ecosystem.
The two companies on Wednesday reveal a gear-out-out-out strategy that offers centered on Apollo Diversified Credit Securitize Fund (Acred), a tokenized feeder fund debuting in January and investing in Apollos diversified credit fund of 1 billion diversified credit fund. The strategy runs on the compound blue, a lending protocol driven by Morpho,
The offer, called delivered RWA strategy, will first be available on polygon (pole). It is expected to expand to Ethereum Mainnet and other blockchains after a pilot phase.
“The idea behind the product is that we want our securities to be a plug and play competitive with stablecoin strategies written big,” said Reid Simon, head of defi and credit solutions at Securitize, in an interview with Coindesk.
Defi -Strategy built on tokenized asset
The introduction comes as tokenized RWAs – foundations, bonds, credit products – get traction among traditional financials. Blackrock, HSBC and Franklin Templeton are among the companies that are investigating blockchain-based asset issuing and settlement. Tokenized US Treasury has only drawn over $ 6 billion, according to data from Rwa.xyz.
While institutions are experimenting with tokenization, the next challenge is to make these assets useful across defi applications. It includes enabling their use as a security for loans, margin trading or building investment strategies that are not possible on older rails.
The strategy uses a deficit dividend optimization technique called “looping”, where the Agrred-tokens deposited in a vault is used as a security to borrow USDC, which is then used to buy more acred. The process is repeated recursively to improve the yield with exposure adjusted dynamically based on real-time borrowing and lending rates.
All trades are automated using smart contracts, reducing the need for manual supervision. Risk is actively controlled by Gauntlet’s risk engine, which monitors leverage conditions and can relax positions under unstable market conditions to protect users.
“This is expected to deliver the institutional quality defi which our industry has promised for years,” said Morpho CEO and co -founder Paul Frambot. “This case is unique how Defi enables investors in funds such as Acred to access financial composing that simply is not possible on traditional rails.”
Vault is also one of the first uses of Securitizes new Stoken tools that allow accredited token holders to maintain compliance and investor protection in decentralized networks. In this case, holy ACred investors that they can use for wider defi strategies without breaking regulatory rules.
“This is a strong example of the institutional quality defense we have been working on building: making tokenized securities not only available but compelling for crypto-native investors seeking strategies that objectively surpass their traditional colleagues,” Securitize CEO Carlos Domingo said in a statement.
