Cracks in the global private credit market are rattling investors, raising concerns the stress could spill into crypto markets.
Bloomberg reported Friday that BlackRock’s $26 billion private credit fund has begun limiting withdrawals amid rising redemption requests. The move follows similar stress at Blue Owl, which sold $1.4 billion in loans last month to meet withdrawals and reportedly has exposure to a collapsed U.K. property lender.
Shares of major asset managers including BlackRock (BLK), Apollo Global Management (APO), Ares Management (ARES) and KKR slid 4%-6% Friday, extending their 2026 rout.
Read more: Blue Owl liquidity crisis has investors bracing for 2008-style fallout
If redemption pressure forces private credit funds to unwind positions, it could trigger broader deleveraging across asset classes that could ripple through digital assets including bitcoin BTC$67,962.60, Andreja Cobeljic, head of derivatives trading at Swiss crypto bank AMINA Bank warned in an emailed note.
Credit stress meets energy shock
U.S. banks extended nearly $300 billion in loans to private credit providers as of mid-2025 and another $285 billion to private equity funds, Cobeljic wrote, carrying risks that credit woes could extend to the banking sector
“In isolation this would be manageable,” he said. “But emerging in the middle of a broader global deleveraging event, alongside an energy shock and collapsing rate-cut expectations, it is a different conversation.”
“For risk assets, including crypto, a disorderly unwind here would represent a significant second-order shock that current pricing does not reflect,” he said.
Contagion to tokenized asset markets
A second channel of credit risk could surface directly on blockchain rails.
Tokenized private credit products — loans and funds packaged and issued on public blockchains as tokens — have grown quickly as part of the broader real-world asset (RWA) trend. According to data from rwa.xyz, the on-chain private credit market now stands at just under $5 billion. That remains tiny compared with the roughly $3.5 trillion global private credit market in 2025, estimated by the Alternative Credit Council.
But the growing presence of these assets inside decentralized finance (DeFi) means stress in the underlying loans could ripple directly to crypto markets.
“Institutions are entering crypto, but often with products that even degens and DeFi natives don’t fully grasp,” said Teddy Pornprinya, co-founder of real-world asset protocol Plume.
Real-world credit products can carry complex risks that are not always obvious to crypto investors, he said, including volatile net asset value swings and headline yields that don’t fully reflect fees or credit risk.
A recent episode shows how off-chain credit stress can spill into DeFi.
According to a report by risk advisory firm Chaos Labs, the 2025 bankruptcy of auto-parts supplier First Brands Group affected a private credit strategy run by Fasanara Capital. A tokenized version of the strategy, mF-ONE, had been issued on the Midas RWA platform and used as collateral for borrowing on the Morpho protocol.
When the underlying fund marked down exposure tied to the bankruptcy, the token’s net asset value slipped about 2%, pushing highly leveraged borrowers close to liquidation and tightening liquidity on the platform. Lenders ultimately avoided losses, but the episode highlighted how tokenized private credit used as DeFi collateral can transmit traditional credit stress into on-chain markets.
