Key Takeaways:
RedStone's Settle service now lets holders of NYLIM's tokenized high-yield bond fund exit in a single blockchain transaction, converting a three-day redemption cycle into immediate USDC liquidity through solver-run auctions.
RedStone said Sept. 1 that Settle is being integrated with the NYLIM Anemou U.S. High Yield Corporate Bond Segregated Portfolio, ticker HYB, issued through Centrifuge. The fund is the first tokenized product sub-advised by New York Life Investment Management, which oversees $838 billion in assets, up from roughly $807 billion when the fund launched in June.
"Tokenization solved issuance. It did not solve settlement — and settlement is what defines whether an asset scales onchain with broader utility," Marcin Kazmierczak, RedStone co-founder and COO, said.
The integration lets HYB holders, lending protocols, and liquidators sell fund units within one atomic onchain transaction. A liquidity provider supplies the capital immediately, takes possession of the units, and later completes the fund's standard T+3 redemption. RedStone describes the service as T+0 settlement, though the underlying redemption period remains T+3 — Settle transfers the waiting period to an approved provider willing to hold the units for a discount.
When RedStone flags a position eligible for liquidation, it runs an offchain auction lasting about 300 milliseconds. KYC-verified and whitelisted solvers bid the discount they require from the HYB reference price; the bid closest to a 0 percent discount wins, so the seller receives the price nearest the unit's calculated value.
RedStone then bundles its latest price update and the liquidation instruction into one atomic transaction. Kazmierczak said the structure blocks front-running because price submission and execution occur together rather than in separate transactions. Atomic execution means every step must succeed or the whole operation reverts, and the winning solver holds a bonded deposit that can be slashed if it fails to supply the promised capital.
Because high-yield corporate bonds do not trade continuously, the auction starts from a fundamental price feed built on net asset value data from the fund administrator, not a round-the-clock spot market. Solver bids then account for the cost and risk of waiting through the redemption period. RedStone said the structure also handles voluntary redemptions and deleveraging, not just liquidations. In a stressed market, prefunded vaults would join auctions to keep backstop liquidity available onchain.
HYB units will be made available as collateral in markets built on Morpho, a decentralized lending protocol with isolated pools. Each Morpho market sets its own collateral assets, loan-to-value limits, and liquidation parameters, keeping HYB's conditions apart from unrelated pools. Curators could use the auction's settlement terms to decide how much credit to extend against each unit, Kazmierczak said.
The integration extends a pattern Morpho established in May, when its lending infrastructure expanded to Tempo with curated markets from Gauntlet and Sentora and RedStone price feeds for stablecoins and tokenized real-world assets. Access to HYB remains permissioned because transfers require approved participants.
HYB enters a tokenized credit market that already includes high-yield strategies from other U.S. managers. Securitize launched a separate fund with Neuberger Berman in August, which RedStone also prices. RWA.xyz data cited by RedStone put tokenized real-world assets above $38 billion in August, versus about $5.4 billion in early 2025, with tokenized U.S. government debt at $16.2 billion and tokenized credit at $7.3 billion. More than 1.7 million addresses held tokenized real-world assets in August, up 56 percent month over month, though addresses do not equal individual investors.
The mechanism matters because tokenized credit has struggled to function as DeFi collateral. An August report on Stellar's DeFi gap found its real-world-asset market exceeded $3 billion while pools on Blend that could accept such assets held only about $2 million. RedStone's model removes the multi-day redemption bottleneck that kept curators from lending against these funds, giving tokenized credit the speed of crypto-native assets without altering the underlying fund structure.
This article is for informational purposes only and does not constitute investment advice.
