Asset Tokenization in Financial Markets 2025

Contents27 Private debt The terms “private debt” and “private credit” are used interchangeably and refer to non- bank lending or bonds outside traditional markets used to fund private businesses.44 The global private credit market has surpassed $3 trillion in assets under management (AUM).45 This asset class consists of higher- risk loans with higher-interest rates than conventional debt. Unlike public debt, private debt is issued by non-bank entities or individuals to raise funds or form capital. Private debt can attract investors, offering higher returns and risk. Private-sector leaders believe private debt will be the first asset class to be tokenized and routinely traded.46 About 70% of private-debt investors are institutional investors or entities investing on behalf of an individual, typically a private credit fund.47 Most private loans on-chain are direct loans to institutional crypto investors. These loans mostly appeal to high-net-worth individuals and accredited investors as yields range from 9% to 20%. However, they carry risks in that the collateral posted is limited in diversity.48 Because crypto-assets such as Ethereum back most loans, significant market corrections of these assets could affect the lending positions of the holders.Examples of the benefits of tokenization for private debt include: 1. Enhances information symmetry Transaction flow would be in real time, providing data on underlying assets at all times.49 2. Facilitates operational efficiency Smart contracts reduce and mitigate back- office costs and lower transaction costs and management fees. 3. Expands accessibility Easing the process of buying into private credit funds and of trading shares can increase the range of investors. For example, in 2022, KKR collaborated with Securitize to tokenize a segment of its $4 billion healthcare fund on Avalanche, reducing investment minimums and onboarding accredited investors, increasing reach.50 On-chain activity for private debt/credit is increasing but is largely limited to crypto- assets and select corporate bond issuances. Protocols such as Maple, Goldfinch and Centrifuge have driven more than $13 billion in on-chain loans in public networks, including Ethereum and Solana.51Tokenized assets FIGURE 10 Tokenized private credit by issuer Figure represents almost 80% of the value of outstanding tokenized private loans Source: RWA.xyz (2025)Figure Tradable Maple PACT MB | Mercado Bitcoin Others$14M $12M $10M $8M $6M $4M $2M $0M Jan 23Mar 23May 23Jul 23Sep 23Nov 23Jan 24Mar 24May 24Jul 24Sep 24Nov 24Jan 25Mar 25