Onchain Credit Facility for RWA Liquidity

Today we're introducing the first onchain credit facility for RWA liquidity. Enabling holders of fixed-duration products to exit at any time via a credit-backed standing bid. We’re taking this to market in partnership with Cap Protocol and YieldNest.

In traditional finance, credit facilities are a foundational piece of market infrastructure. When a fund holds illiquid, fixed-maturity assets, a committed credit line allows investors to redeem early. The facility absorbs exit demand and risk while the underlying position runs to maturity. It's how liquidity is manufactured in an inherently illiquid market.

DeFi doesn't have this. RWA products with fixed maturities; loans, bonds, structured credit all lock capital for their duration. Holders who need to exit have no mechanism to do so. This limits composability in DeFi as liquidity is required to support collateralization and looping of these assets. This is a structural barrier for RWA adoption and one that can be solved at scale with a dedicated credit facility.

How it works

A credit line is established on Cap Protocol, underwritten by restakers who provide the financial guarantee that backs lending. This creates a committed pool of capital available to draw against, only deployed when needed.

That credit line is delegated to the RWA issuer, in this case YieldNest, who uses it to place a standing bid in Agra. The bid sits continuously in the market, ready to absorb any holder who wants to exit their position before maturity. No negotiation is required, the liquidity is always there.

YieldNest periodically redeems and rebalances the underlying position, the proceeds replenish the credit line. Resetting capacity and keeping the facility live for the next cycle.

Why this matters

This is the first time a credit facility is being used to provide standing liquidity for an RWA. The implications of this go beyond an early redemption use case. It is instrumental to accelerate supported collateral in DeFi.

Fixed-duration RWAs have limited support in DeFi today. You can hold them, but you can't do much else. They don't work as collateral in lending markets because lenders can't liquidate illiquid positions. They can’t be looped or compose into the DeFi stack.

The addition of standing liquidity solves this. When exit liquidity is guaranteed, the asset behaves more like a liquid instrument, even if the underlying is not. That unlocks collateralization, structured products and makes fixed-duration RWAs competitive with their liquid counterparts for the first time.

For issuers this is a distribution advantage. Products with built-in liquidity attract a broader investor base, including those who would otherwise avoid fixed-duration exposure entirely.

What's next

The credit facility with YieldNest is the first. It won't be the last.

Every fixed-duration product faces the same structural problem: capital locked, no composability, limited investor base. The facility is a repeatable solution. One that scales across issuers, products and chains.