New York Life Investment Management Launches First Tokenized Bond Fund With Centrifuge

New York Life Investment Management, or NYLIM, has launched its first tokenized product in partnership with blockchain-based tokenization platform Centrifuge.

The two firms jointly launched the NYLIM Anemoy U.S. High Yield Corporate Bond Segregated Portfolio, ticker HYB, The Block reported on June 30. It is NYLIM's first tokenized product and one of the early examples of an on-chain high-yield corporate bond strategy.

HYB offers qualified investors access through the Centrifuge platform to an institutional high-yield strategy that NYLIM already manages. Investor subscriptions and redemptions are settled in Circle's USDC stablecoin. High-yield corporate bonds carry higher risk because of their lower credit ratings, but offer higher yields.

Centrifuge Chief Executive Officer Bhaji Illuminati told The Block that NYLIM is among the first large insurance-affiliated asset managers to enter tokenization. The two sides have worked closely over the past six months to identify where to begin.

NYLIM, which manages about $807 billion in assets, could become Centrifuge's largest partner, he added. Centrifuge already works with major Wall Street firms including Apollo Global Management and Janus Henderson, and supports products including a AAA-rated CLO portfolio with more than $700 million in assets.

Thomas Shi, head of multi-asset solutions at NYLIM, told The Block that tokenization reflects how investment solutions are evolving in how they are accessed, managed and distributed across public and private markets. The firm is exploring opportunities for blockchain infrastructure to complement existing platforms and deliver greater value to clients.

HYB is structured as a British Virgin Islands segregated portfolio and is not currently available to U.S. investors. It is aimed primarily at on-chain investors, including stablecoin issuers, decentralized finance users and decentralized autonomous organization treasury managers. Its liquidity solution will offer functionality close to instant redemptions through a partnership with Grove, which is built on the MakerDAO ecosystem.