Sea Beaver on Nostr: "Private credit promised stability and delivered a locked door. Bitcoin promises ...

"Private credit promised stability and delivered a locked door. Bitcoin promises nothing except a market that never closes."

quoting
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Apollo just told investors they can have 45% of their money back. Ares did the same thing this morning.

Both capped redemptions at 5% after investors tried to pull 11%. Blackstone, BlackRock, Morgan Stanley, and Cliffwater have collectively received over $10 billion in redemption requests this quarter. The industry is honoring about 70% of them.

Goldman Sachs predicts the retail private credit sector could shed $45-70 billion in assets over the next two years. These funds ballooned from $34 billion in 2021 to $222 billion by end of last year. That unwind is starting now.

The contagion path writes itself: gates go up, NAV marks become suspect, CLO tranches get repriced, bank balance sheets take hits, credit tightens, equities compress. Mohamed El-Erian is comparing this to the early stages of 2008.

Alternative asset stocks are already pricing it in. Blackstone, KKR, Blue Owl, and Ares have each dropped 25%+ this year, erasing over $100 billion in combined market cap.

The "illiquidity premium" was always just a euphemism for "you can't leave."

Compare that to bitcoin. It trades 24/7, 365 days a year, across every jurisdiction on earth. You can liquidate a billion dollars at 3am on Christmas and the market absorbs it. No gates. No lockups. No waiting until next quarter for 45 cents on the dollar.

Private credit promised stability and delivered a locked door. Bitcoin promises nothing except a market that never closes.