You Won’t Believe How Apollo’s Credit Fund Just Shook Up DeFi—And Why It’s a Laugh Riot

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What to know:

  • Securitize and Gauntlet, feeling particularly audacious after lunch, have taken Apollo’s credit fund, split it into tokens, and tied it to a leveraged DeFi yield strategy. The risk? Only the faint whisper of financial dignity slipping away. 🍸
  • The strategy, christened “Levered RWA,” will set sail first on Polygon, with grand tales of imminent travels to Ethereum Mainnet and other blockchains. (“Expansion”, they call it, as if booking a vacation.)
  • They’re employing something called “looping” to squeeze more yield—picture a hamster wheel, but with tokens and marginally more existential dread.

In Dubai—where dreams and speculative finance hold hands beneath the harsh desert sun—Securitize and Gauntlet have teamed up, quixotically, to deposit a tokenized chunk of Apollo’s credit fund into DeFi. Or as one might put it at a less elaborate dinner party: they are daring to shovel real-world assets into the great chasm of crypto opportunity. 🎩

This pair is now debuting a leveraged-yield spectacle, centering around the Apollo Diversified Credit Securitize Fund, dubbed “ACRED,” which has the air of a debutante—elegant, mysterious, and perhaps one day broke. It’s a feeder fund with stakes in Apollo’s $1 billion Diversified Credit Fund, and its new playground will be Compound Blue on Morpho, for those who like their jargon without cream or sugar.

The stated aim? To make securities “plug and play” with stablecoin strategies. Reid Simon of Securitize, in what we can only imagine was a slightly fatigued sigh, called it an effort to “compete.” We wish him strength.

DeFi strategy built on tokenized asset (sure, why not)

Tokenized things—bonds, credit, hope—are the season’s hottest trend. BlackRock, HSBC, Franklin Templeton, and possibly your neighbor with a suspiciously large server rack all want in. Already, tokenized U.S. Treasuries, which sound absolutely thrilling at parties, have drawn in north of $6 billion. (RWA.xyz would know, they’re counting.)

But here lies the rub: It’s no longer enough to mint these digital curiosities; one must actually use them. DeFi is trying. The possibilities: collateralized loans, margin trading, or other strategies undreamt-of by the ghost of Wall Street—at least until last autumn.

The strategy’s “looping” technique is a recursive little dance. You deposit ACRED, borrow USDC, buy more ACRED, do it again, and again, much like your uncle with credit cards and home equity except, hopefully, with fewer awkward Thanksgiving arguments.

Smart contracts do all the work, so you can sit back, pour a drink, and watch algorithms perform the ballet of potential ruin. Gauntlet’s risk engine peers nervously at the numbers, ready to pull the plug if things get dicey—just like a mother-in-law guarding the family fortune. 🤓

Paul Frambot of Morpho looked point-blank at the camera and called this “institutional-grade DeFi,” which is the blockchain equivalent of saying you replaced your Ikea lamp with a chandelier. It’s composability, but make it fancy.

Securitize’s sToken makes an appearance: now, accredited investors can don their virtual bowler hats, mint sACRED, and play without worrying about pesky regulators showing up at the poker table. Compliance, but with more acronyms.

Finally, Carlos Domingo, Securitize’s CEO, assures us that this is what institutional investors really want: tokenized assets so attractive, even the most jaded DeFi enthusiasts consider moving back in with their parents. If Chekhov were here, he’d raise an eyebrow and ask if this story ends at a country estate or just with another long winter.

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2025-04-30 16:15