Unchained - Why CLOs Are Suddenly DeFi's Hottest Yield Play

Episode Date: July 10, 2026

Niklas Kunkel maps where the RWA market is heading next, from Centrifuge and Apollo's CLOs to Galaxy's first tokenized credit product, then turns to a cautionary tale: some SpaceX pre-IPO token buyers never actually owned the shares they thought they had. Host: Steven Ehrlich - Host of Bits + Bips and Head of Research at Sharplink Guest: Niklas Kunkel - Founder and CEO of Chronicle Labs This clip is from a longer conversation on crypto oracles, tokenized real-world assets, and Chronicle Labs' work verifying them. Full episode here: https://youtu.be/HW9Cu_E8DnU  We go live every week - subscribe to catch it live. Cape: Your biggest crypto vulnerability isn't your wallet, it's your phone number. Cape is America's privacy-first mobile carrier that rotates your SIM identity daily and blocks SIM swaps before they happen. Get 33% off your first six months at https://cape.co/unchained (use code: UNCHAINED). Chapters 🌍 00:00 Where the RWA market goes next, from the man building its plumbing: Niklas Kunkel 💰 00:44 The yield trade heating up: why CLOs like Centrifuge's JAAA and Apollo's Acred are suddenly everywhere 🌌 01:14 Galaxy's first tokenized CLO, and why it's a far bigger deal than it looks 🔍 01:56 Trust no one: how Chronicle checks Galaxy's loan book against its own custodian 🔁 03:04 The looping trick that turns a 7% CLO yield into 14% or 21%, and the risk hiding inside it 🏢 03:27 What's coming next: tokenized REITs and equities 🚀 05:28 The SpaceX pre-IPO token question Niklas keeps getting asked 📉 06:06 The catch nobody mentioned: why SpaceX token buyers never actually owned their shares Learn more about your ad choices. Visit megaphone.fm/adchoices

Absolutely. I mean, I think we kind of get a front line seat to seeing like where the market is heading, right? Because we see what clients are working on and how we need to adapt our technology to be able to support those use cases. You know, as you pointed out, right, I think the shift over the last 12 months as, you know, as monetary policy rates, you know, have kind of studied is how, you know, can we kind of increase yield, right? It's no surprise, right, that in Defi, you know, people love their yield. They love their kind of yield looping strategies, right? So the race has been to create products that are, you know, attracted to that part of the market, right? And that's really where we've seen CLOs take off, right? So we saw, you know, Centrifuge with Janice Henderson launched J-Triplea, right? We saw, like, what else did we see?

I mean, Hamilton, Lane and. An acred. Exactly. Yeah. Right. There was the Apollo Appredics, right? You know, all of these, which we actually support a Chronicle. And I think even just yesterday or I think it was like two days ago now, we announced, right, that we were supporting galaxies first tokenized CLO, which, you know, I think is quite interesting because, you know, Galaxy, if they're getting into tokenization, I mean, they're going to be a really huge, huge player.

I mean, they have the network and they sit kind of perfectly nestled in between, you know, defy and on the TratFi side. So I think, I think they're going to do really well. And I mean, like the product that we support there, right, is Galaxy is either directly or indirectly, right, letting people borrow against their crypto, right, against Bitcoin, against ETH, Seoul, XRP, right, whatever it is. And so, you know, all that we are doing, right, is we are getting, like the loan book from from galaxy um and then we're going to their custodian right we're going to anchorage and we're checking like okay um is there actually you know all this btc all this soul all this xrp all this eth in custody you know can we trace every way you know every satoshi you know

that is claimed to be you know as collateral on these books right we identify the the liabilities And now we can say, okay, you know, this CLO is 200% collateralize, right? And so, okay, and it's yielding 7%. Right. So it's giving pretty good yield. Right. And so now, one, like anyone who wants to potentially buy this galaxy CLO, right, like can see, okay, look into the guts and like know that like someone independent like Chronicle has like

validated all of this. but two, now someone like Morpho, you know, you can have a vault and you can create like a looping strategy on this, right? So you can juice your 7% yield into 14 or 21%, right? What have you. Right. And that's really like what like, you know, it's this two stages of like what Chronicle enables. Like one, it's the transparency that gives like the confidence in these assets. And then two, right, it's the ability for Defi right to to integrate them. Yeah. So I'm just, I'm just, In terms of like what's what's coming up, you know, we're seeing, for example, like REITs, like real estate investment trusts are, there's a couple of those coming out.

So we're excited about those. I think you may have seen Centerfuge just announced with New York Life that they're going to be releasing a new, like a new fund as well. I think kind of equities right now are really hot and I think it'll take a while to get there, right? Like you were alluding to before, right, that there's like all these promises and some of them have panned out and some of them haven't. I don't think it's a matter of it hasn't, it doesn't pan out. I think it's more a matter of just like it needs more time than anyone thinks it does. But the promise is huge, right? Like if you go, if you have some stock, if you have Tesla stock and you want to go borrow against your Tesla stock, like your broker is going to charge you like very high single digits, low double digits, right?

Versus in Defi, I mean, if you're going to lend these things with the, I don't know, LTV of like 30%. or something, right? You know, Defi will like offer you like mid to, you know, high, you know, single digits on this stuff like all day. Like if you look at OPP, what do you get for lending USC? You're getting 2.7%. You're literally getting less than T bills. Like, so there's, I think there's really an opportunity, right, for Defi to kind of be the mechanism where it can,

one of the flywheels for tokenized equities taking off is just going to be this ability to get leverage against your equities at much cheaper rates than you can in TradFi with your broker. Yeah, one thing I was actually kind of really dying to ask you is I want to get your thoughts on some of the, I guess, controversy that's surrounded, like, for instance, the SpaceX IPO and some of the markets that were spun up where people were able to kind of bet

on the price of some of these pre-IPO shares or private market shares. And I know with the SpaceX, I mean, I think there were a couple of like tokenized providers that had to give back the money because they weren't able to procure the shares out there. And I mean, that seems to be like the types of issues that a company like yours would, I guess, make sure does not, do not happen. Yeah. Sure. I mean, at that, it's people didn't know what they were buying, right? They were buying an SPV on an SPV on an SPV, right? They had like second degree, third degree exposure.

And yeah, when it came time to, hey, I want to get my shares, right? A lot of these things blew up, rather from fraud or just improper legal structuring, right? Or just they never got the shares. But yeah, right, this is really what Chronicle is here to do, right? It's just give you absolute end-to-end transparency into everything. And that's what's going to keep defy anti-fragile. That's how we're going to scale defy with tokenized assets and keep defy, you know, from not having the same systemic risks that we see in the traditional financial industry. If you hold crypto on your phone, your biggest vulnerability isn't your wallet.

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