London-based private credit manager Fasanara Capital and stablecoin issuer Tether have launched a $400m private credit fund that embeds cryptocurrency infrastructure into traditional lending markets, in one of the most prominent convergences yet between digital assets and institutional credit.

The Tether-Fasanara Lending Fund is structured as an evergreen vehicle, with the two firms targeting up to $3bn in third-party institutional capital over time. The fund integrates USDT, Tether's US dollar-pegged stablecoin, into consumer and small and medium-sized enterprise lending flows across fintech platforms.

"Tether brings something unique to that equation: the largest stablecoin network in the world, a crypto-native investor base with significant capital capacity, and USDT rails that extend the reach of credit beyond anything conventional funding structures can achieve," said Francesco Filia, chief executive of Fasanara Capital.

Fasanara will act as investment manager for the fund, deploying capital into short-duration, asset-backed credit strategies. Tether will serve as co-sponsor, acting as originator and adviser while sourcing USDT-linked financing opportunities and providing the stablecoin settlement infrastructure.

The partnership represents a notable step in the institutional adoption of blockchain-based settlement in private credit. While digital asset firms have made incremental inroads into traditional finance over the past several years, the launch of a jointly sponsored fund at this scale — with explicit ambitions to grow to $3bn — marks a shift from experimentation to committed deployment.

For European private credit markets, the vehicle is relevant as a signal of how alternative capital sources are being channelled into real-economy lending. Fasanara has built its platform around technology-enabled credit origination, and the addition of stablecoin settlement rails could accelerate cross-border capital flows into European SME and consumer lending markets that have historically been fragmented.

"Together with Fasanara, we are turning Tether's origination network into a direct channel for capital to flow to the businesses and communities that need it most," said Paolo Ardoino, chief executive of Tether.

The fund's initial $400m commitment positions it as a meaningful entrant in the fintech lending space, though the $3bn target suggests both sponsors view stablecoin-linked credit as a strategy with significant scaling potential. For institutional allocators evaluating the convergence of digital assets and private credit, the vehicle offers an early test case of whether crypto-native infrastructure can deliver operational efficiencies in traditional lending markets.