Wall Street is closely watching the "elephant in the room": private credit risk approaching the $5 trillion threshold

As the scale of private credit assets is expected to reach $4.9 trillion by 2029, concerns on Wall Street about its "opacity" have reached new heights. Following the bankruptcy of several supported companies in early 2026, JPMorgan Chase CEO Jamie Dimon issued a "cockroach warning," suggesting that potential default risks are being concealed. Currently, borrowers are frequently using "payment-in-kind" (PIK) options to delay defaults, while the stock prices of large alternative asset management firms like Blackstone and KKR continue to be pressured due to doubts about valuation authenticity. Meanwhile, banks are deeply involved by lending to non-bank financial institutions, exacerbating the risk of cross-contamination in the financial system