Securitize and Gauntlet Roll Out Tokenized Apollo Credit Fund with Leveraged Yield Strategy in DeFi

Securitize, in collaboration with Gauntlet, has introduced a tokenized version of the Apollo Diversified Credit Fund, marking a major step into the DeFi space with a strategy focused on leveraged yields.

The new offering is a tokenized feeder fund that invests in Apollo’s $1 billion credit fund, aiming to give investors exposure to real-world asset-backed credit while tapping into decentralized finance (DeFi) opportunities. The fund will leverage a passive, automated strategy through the Compound Blue protocol, powered by Morpho, to amplify yields.

The product, which uses the ACRED token, will initially launch on the Polygon blockchain and later expand to other networks. This initiative aligns with a broader push to bridge the gap between traditional finance and blockchain by bringing real-world credit exposure into the DeFi ecosystem.

“Through tokenizing Apollo’s credit fund, we’re bringing a new layer of sophistication to DeFi,” said Reid Simon from Securitize. “This is an opportunity for investors to tap into higher returns through blockchain technology while maintaining exposure to traditional credit assets.”

The strategy will employ “looping,” where ACRED tokens are used as collateral to borrow USDC, which is then reinvested in more ACRED tokens. The process continues, magnifying potential returns while managing risks through Gauntlet’s automated risk engine, which monitors leverage and adjusts exposure in real-time.

The tokenization of real-world assets has become a growing trend as companies explore the potential of blockchain in transforming traditional asset management. By launching this tokenized credit fund, Securitize and Gauntlet are setting a new precedent for decentralized asset management, providing institutional-grade products in a decentralized environment.

With Securitize’s sToken technology, investors can stay compliant while interacting with DeFi markets, ensuring a seamless integration of traditional finance assets into the decentralized world.