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Percent and Anzen pioneer credit default swaps for private credit investments

Percent, the capital markets platform transforming the multi-trillion-dollar private credit markets, today announces a new risk mitigation tool for investors. Percent, which continues to innovate and modernize the private credit markets, has partnered with Anzen to offer the first credit default swap protection on private credit investment offerings to retail accredited investors, beginning with Percent’s blended notes.

Beginning in June, some of Percent’s offerings will include mitigation for potential downside risk driven by default or non-performance of the underlying assets, starting with the June 15 issuance of Percent Blended Notes (“Blended Notes”).

Blended Notes provide investors with a single investment basket that offers exposure to multiple products. While these investments give investors a simpler, easier way to diversify their portfolios and broaden access to the private credit markets, until now there has been no way to provide default protection for a basket that includes assets from multiple borrowers.

Percent and Anzen’s innovative solution combines traditional and decentralized finance (DeFi), using Credit Default Swaps (“CDS”) to hedge against default risk. A portion of interest paid or principal amortization on the underlying securities of each Blended Note will be pooled to create a reserve fund while the remainder will be generated through DeFi yield farming. This fund will provide protection for a specific tranche or slice of note exposure, with CDS premium, triggers, and other relevant details provided in the transaction documents of each Blended Note. In keeping with Percent’s commitment to transparency, investors can see the amount held in the treasury in real-time, along with what the coverage ratio would be in the event of a default at any given point in time during the maturity of the note. These details can be viewed on any block explorer (e.g., Etherscan) as well as on each individual deal page. 

This partnership with Anzen is Percent’s latest risk management innovation, designed to make private credit securities more attractive by implementing best practices found in public markets. The introduction of enhanced default protections follows the launch of Percent Blended Notes, which simplified market access and diversification, and the recent implementation of collateral verification from MTAG Services, LLC, which provides independent validation of receivables and other data reported by originators. 

For more information, visit Anzen, contact Percent, or consult the investment documentation for each Percent Blended Note. 

About Percent

Percent is a global leader in financial infrastructure solutions. Founded in 2018, the company leverages proprietary technologies, integrations, and data to bring first-of-its-kind transparency and efficiency to lenders and credit transactions. Percent’s innovative ecosystem enables companies of any size to raise the most flexible debt capital at a low cost through dynamic market pricing and standardized terms. To date, its platforms have powered more than $700 million in transaction volume in a multi-trillion-dollar lending market.

For more information about Percent, visit our website, and follow the company on Facebook, Instagram, LinkedIn and Twitter.

To learn more about Anzen, visit https://anzen.finance/ or find the team on Discord and GitBook.

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