900 Billion Assets Manager Launches Tokenized Private Credit Fund on Solana Blockchain

Hamilton Lane, one of the world’s largest alternative asset managers with over $920 billion in assets under management and supervision, has launched a private credit fund on the Solana blockchain. The firm’s Senior Credit Opportunities Fund, or SCOPE, is now accessible via Solana, thanks to a partnership with Libre, a Web3 protocol developed by Brevan Howard’s WebN Group and Nomura’s Laser Digital.

Libre CEO Dr. Avtar Sehra highlighted the potential to reach "mass affluent, crypto native" traders through tokenization. Libre facilitates accredited investors' access to top-tier funds on networks like Solana, supporting secondary trading and collateralized lending. Sehra praised Solana's low latency and throughput as key benefits for tokenization.

This move marks Solana's first institutional fund launch, expanding on previous tokenization efforts like Ondo Finance’s U.S. treasury bills. Hamilton Lane has previously tokenized funds via Securitize and is now venturing into collateralized lending on Solana. Victor Jung, Hamilton Lane’s head of digital assets, emphasized the goal of attracting decentralized finance natives to this new asset class.

Tokenizing real world assets (RWAs) involves creating digital tokens that represent assets like cash, real estate, and private credit. This process aims to increase liquidity, transparency, and accessibility in financial markets. Proponents believe tokenization will eventually encompass all financial assets, as stated by BlackRock CEO Larry Fink.

The private credit industry, valued at over $3.14 trillion, has grown significantly since the 2008 financial crisis. Private credit involves non-bank lenders providing loans to businesses unable to access corporate bond markets. Investors in these funds benefit from high returns and exposure to a diverse range of companies.

SCOPE, launched in 2022, offers a 10% annualized yield for USD investors and aims to provide stability and yield in varying market conditions. Tokenization offers advantages like immediate ownership transfer and enhanced liquidity through secondary markets. For example, tokenized assets can be swapped for various tokens on decentralized exchanges, deepening liquidity.

While SCOPE targets high-net-worth investors, some skepticism remains about the demand for tokenized financing platforms. Critics argue that crypto investors may prefer higher returns from volatile assets and may be reluctant to undergo KYC procedures. This mismatch between the product and its target market poses a challenge for issuers of tokenized private credit.