When asked about the potential risks of connecting DeFi to the often opaque private credit sector, Pareto acknowledged the concern but emphasized its approach to risk management.“That’s a fair concern, but Pareto was specifically built to address the inefficiencies and opacity that have historically plagued traditional credit markets,” Pandolfi said, adding:“By bringing private credit onchain, we enable real-time transparency, programmable risk management, and automated settlement while reducing counterparty risk and operational friction.”A chart highlighting the growth of the tokenized credit market.Source: RWA.xyzRelated: VanEck to launch its first RWA tokenization fundStablecoins: From crypto niche to the mainstreamAlthough synthetic dollars account for a small fraction of the total stablecoin market, they are driving innovation by introducing new methods for creating and managing fiat-pegged assets.
Under President Donald Trump, the US government has recognized the role of stablecoins as a “way to support the dollar’s worldwide use as a reserve currency,” Komodo Platform’s chief technology officer, Kadan Stadelmann, told Cointelegraph in a written statement.“Stablecoins are the second-most adopted blockchain use case behind Bitcoin — more than NFTs and DeFi,” he said.“US dollar-pegged stablecoins account for a mind-boggling 1% of the M2 money supply.”The total stablecoin market is approaching $250 billion, with Tether accounting for roughly $150 billion.
Related: Coinbase invests in Canadian stablecoin issuerInstitutional entry into RWA credit marketThe company said the synthetic dollar gives institutional investors a regulated onchain entry point into real-world asset (RWA) credit markets — a segment of the tokenization industry that has expanded rapidly over the past year. Recent examples of private credit tokenization include Tradable’s portfolio of 30 credit positions and Apollo’s Diversified Credit Securitize Fund.
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