Yasuda on Tokenization

Apollo Global Management is pioneering new ways for investors to access private credit through two distinct offerings: the Apollo Diversified Credit Securitize Fund (ACRED) and the SPDR SSGA Apollo IG Public & Private Credit ETF (PRIV). ACRED is a tokenized private credit fund offered through Securitize, designed for institutional and accredited investors. It provides exposure to a diversified portfolio of private credit assets, including corporate direct lending, structured credit, and asset-backed lending. The fund leverages blockchain technology to enhance efficiency, transparency, and liquidity while reducing operational costs. Apollo's move to tokenize private credit aligns with broader trends in digital asset adoption within traditional finance.

In contrast, PRIV, launched in partnership with State Street Global Advisors, is an actively managed ETF offering exposure to both public and private investment-grade credit. Unlike ACRED, PRIV is structured for retail investors, providing daily liquidity through public markets. To address liquidity constraints associated with private credit, Apollo has committed to offering daily pricing and executable bids for the ETF’s private credit holdings. However, regulatory challenges persist, as the U.S. SEC has scrutinized the ETF's liquidity structure and Apollo’s branding within the fund’s name. Despite these hurdles, PRIV represents a significant step in integrating private credit into publicly traded investment vehicles.

Both ACRED and PRIV illustrate the growing institutionalization of private credit, but they serve different investor bases with contrasting liquidity profiles. ACRED offers blockchain-driven efficiency and fractional ownership, appealing to institutional players looking for streamlined digital access to private credit. Meanwhile, PRIV provides a liquid, accessible option for retail investors, blending private and public credit exposures within an ETF framework. Together, these initiatives reflect Apollo’s commitment to modernizing private credit markets, leveraging both traditional and digital asset innovations to expand investor access.

The Institutional Limited Partners Association (ILPA) unveiled its updated Reporting Template and a new Performance Template. These revisions aim to enhance transparency, standardization, and comparability in private fund reporting. The Reporting Template builds on the original 2016 version, incorporating detailed disclosures on fees, expenses, and carried interest. It also adds granular data fields for cash flows, internal chargebacks, and external partnership expenses. The Performance Template introduces standardized methodologies for calculating fund-level returns, offering two options: granular and gross-up methods. These updates reflect extensive industry consultation and are designed to align with evolving accounting standards and investor expectations.

The new templates were developed through ILPA’s Quarterly Reporting Standards Initiative (QRSI), launched in 2024. This initiative engaged limited partners (LPs), general partners (GPs), service providers, and consultants to address the complexities of modern investment structures. The templates also incorporate elements of the now-vacated SEC Private Fund Advisers Rule, such as quarterly disclosure requirements. Adoption is voluntary but expected to gain traction due to investor pressure. The templates are set to replace the previous version starting in Q1 2026 for funds still in their investment period or commencing operations after January 1, 2026.

Tokenization of private funds could significantly facilitate compliance with ILPA’s updated guidelines by automating data management and enhancing transparency. Blockchain technology enables seamless tracking of cash flows, fee allocations, and performance metrics while ensuring data is stored in a standardized format accessible to all stakeholders. Smart contracts can automate reporting processes, reducing manual errors and improving efficiency in meeting ILPA’s requirements.

On March 6, 2025, President Donald Trump signed an executive order creating a Strategic Bitcoin Reserve and a U.S. Digital Asset Stockpile. This initiative aims to position the United States as a global leader in digital asset management. The reserve will primarily consist of approximately 200,000 bitcoins seized through criminal and civil forfeitures, valued at an estimated $17 billion. Unlike previous practices of liquidating such assets, the government will retain these bitcoins as a long-term store of value, likened to a “digital Fort Knox.” The order also mandates a comprehensive audit of federal digital asset holdings and establishes budget-neutral strategies for acquiring additional bitcoin without burdening taxpayers.

In addition to bitcoin, the U.S. Digital Asset Stockpile will include other cryptocurrencies obtained through forfeitures, such as Ethereum, XRP, Solana, and Cardano. However, no new acquisitions are planned for these assets. The move has sparked mixed reactions: while some see it as a historic step toward mainstream adoption of cryptocurrencies, others criticize the inclusion of multiple digital currencies alongside bitcoin. This policy shift aligns with Trump’s broader efforts to promote the cryptocurrency sector, culminating in an inaugural White House crypto summit on March 7. Proponents argue that this initiative could solidify bitcoin’s status as “digital gold” and enhance its global significance.