DigiFT Tokenizes $6.3 Billion Private Credit Fund Managed by Invesco
Singapore-based blockchain platform DigiFT has announced its plans to tokenize a $6.3 billion private credit fund managed by Invesco, marking a significant milestone in merging traditional finance with blockchain technology.
The tokenization of the fund will allow institutional investors to purchase tokenized shares using U.S. dollars or stablecoins such as USDC and USDT, providing them with access to the Invesco private credit fund which primarily invests in senior secured loans and has delivered a 4.5% annual net yield since its inception in 2006, according to DigiFT CEO Henry Zhang.
Unlike traditional tokenized private credit funds with long redemption cycles, this fund will offer daily liquidity, offering investors a more flexible investment option. The rise of tokenization, the process of converting traditional assets into digital representations on the blockchain, is gaining momentum with 80% of on-chain real-world assets being private credit, as reported by rwa.xyz.
In a first for Invesco, an asset manager with $1.9 trillion in assets under management, this collaboration with DigiFT marks its entry into the world of fund tokenization. Invesco estimates that tokenized funds could manage up to $600 billion by 2030, representing 1% of total assets in mutual and exchange-traded funds.
DigiFT, a key player in the tokenization space, recently became the first distribution partner for UBS’s uMint, a tokenized money market fund. The platform operates under Singaporean regulations and holds licenses as a market operator and capital markets entity.
Settlements for the tokenized Invesco fund by DigiFT will take up to five days, with redemptions available daily. Zhang revealed plans to launch an on-chain liquidity pool to enable investors to quickly redeem tokens at a slight discount, managed by liquidity providers handling the underlying settlement process.
As prominent asset managers like Franklin Templeton and BlackRock embrace tokenization, DigiFT’s latest move underscores the increasing adoption of blockchain technology in traditional finance.