PAPY earns yield by lending AUSD deposits programmatically against a diversified set of overcollateralized tokenized real-world assets (RWAs) on the Morpho protocol, targeting 5–6% variable APY.
SAN FRANCISCO, Sept. 2, 2026 /PRNewswire/ — Bitwise Asset Management, a global crypto asset manager with $9 billion in client assets, today announced the launch of PAPY, the Bitwise Premium RWA Vault. The vault accepts AUSD stablecoin deposits and lends against a diversified set of real-world asset (RWA) collateral that includes PST, sUSDai, and PRIME, targeting a 5–6% variable APY. By lending against real-world credit, PAPY aims to deliver yield that is more durable and less correlated with crypto markets than most onchain lending offers today.
How PAPY works. Lenders deposit AUSD into the PAPY vault on the Morpho protocol. Those deposits are then lent to borrowers who post white-listed RWA collateral and pay an algorithmically derived, variable interest rate. For the PAPY vault, Bitwise’s curation involves predetermining the vault’s parameters and precalibrating its models—including acceptable collateral, loan-to-value ratios, and interest-rate configuration—without taking custody of or exercising discretionary management over user assets.
The featured RWA markets upon launch include:
- Huma Finance’s PST: Short-duration cross-border payment financing. Loans are made to licensed financial institutions on one- to seven-day terms, with zero historical defaults across $17 billion in transaction volume.
- USDai: Loans backed by GPUs powering AI infrastructure. The collateral sits in a bankruptcy-remote SPV with a first-priority lien, is independently monitored, and loans self-liquidate; its value is warranted and reinsured via a Munich Re subsidiary.
- Hastra PRIME: A tokenized claim on a warehouse lending facility collateralized by prime home equity, with rates set on a rolling one-hour term and automatic substitution of any non-performing loans. ($PRIME is issued by Hastra, a protocol built in partnership with Figure.)
AUSD, the deposit asset. Deposits are made in AUSD, Agora’s stablecoin, which is fully collateralized by U.S. Treasury bills, overnight and reverse repo, and other liquid assets. AUSD’s reserves are managed by VanEck and custodied at State Street.
Note: All descriptions and figures above are as stated by provider.
Why RWAs? Most onchain yield today comes from two crowded models: commoditized bitcoin-backed lending or crypto-native yield farming. PAPY offers a more durable approach. Loans secured by RWAs tap deeper traditional-finance credit markets, so the interest borrowers pay isn’t tied to crypto cycles or onchain liquidity.
“We believe a diverse basket of collateral gives users a better risk-adjusted lending experience, but that only works with a specialist curator,” said Jonathan Man, Portfolio Manager at Bitwise. “Our team brings 20-plus years of experience across structured credit, private credit, and the technology behind DeFi, and that’s what informs our approach to bringing real-world asset collateral onchain with the Bitwise Premium RWA Vault.”
“We’re excited to have Bitwise curating on Morpho and launching their first strategy on the network,” said Paul Frambot, CEO and Co-Founder of Morpho. “Morpho supports a rich set of RWAs and what Bitwise adds is the expertise to combine them into a single diversified strategy, giving users new curated ways to access real-world yield. This is how the Morpho network expands into new risk profiles and strategies that weren’t possible before.”
“We’re really excited to work with Bitwise,” said Nick van Eck, CEO and Co-Founder of Agora. “It comes down to high-quality, high-integrity partners working together to steer users in the right direction. More and more institutional managers are choosing AUSD for structured credit and RWA strategies, and Bitwise’s PAPY launch is a strong example of where that’s headed.”
As more of the world’s capital moves onchain, Bitwise expects real-world assets to lead the way—and PAPY, the Bitwise Premium RWA Vault, is designed to give lenders access to that trend through a transparent, programmatic lending infrastructure. It’s the newest way Bitwise is connecting traditional finance and onchain markets, from ETFs and staking to tokenized portfolios and vault curation.
For more information, visit https://onchain.bitwiseinvestments.com/vaults/papy-ausd.
About Bitwise
Bitwise Asset Management is a global crypto-focused asset manager with $9 billion in client assets and a suite of over 70 investment products spanning ETFs, separately managed accounts, private funds, hedge fund strategies, and staking. The firm has a nine-year track record and today serves more than 5,500 private wealth teams, RIAs, family offices, and institutional investors, as well as 21 banks and broker-dealers. The Bitwise team of technology and investment professionals is backed by leading institutional investors and has offices in San Francisco, New York, and London.
About Agora
Agora is a stablecoin issuer and infrastructure platform building the monetary network for global settlement. Agora issues AUSD, an institutional-grade, fully backed U.S. dollar stablecoin built for financial products, fintechs, and applications. Agora provides the platform for treasury management, settlement, and cross-border flows.
About Morpho
Morpho is an open lending network with $13B+ in deposits connecting lenders and borrowers to the optimal opportunities worldwide. Its modular, open infrastructure enables fintechs, wallets, exchanges, and institutions to embed configurable credit products directly into their platforms, while maintaining full control over the user experience. Leaders like Coinbase, Robinhood, Bitwise, and Société Générale already build on Morpho to deploy secure, scalable onchain credit products. For more information, please visit Morpho.org.
Risks and Important Information
This vault is a technology-mediated lending protocol in which users supply AUSD to a lending pool and earn variable interest paid by borrowers. It is not a managed fund, investment product, or common enterprise. Yield is generated from algorithmically determined interest based on borrower demand and protocol utilization — not from the entrepreneurial or managerial efforts of Bitwise or any other person.
Vault Curation Services for this vault are provided by Bitwise Investment Manager, LLC (“BIM”). BIM is registered with the U.S. Securities and Exchange Commission (“SEC”) as an investment adviser. That registration relates to BIM’s separately conducted advisory business. BIM is not acting as an investment adviser, fiduciary, or in any advisory capacity in connection with this vault. The SEC has not approved or endorsed this vault or any vault product. No regulatory protections afforded to BIM’s investment advisory clients extend to vault users. No advisory, fiduciary, trust, or client relationship is created between BIM and any vault user.
Custody of assets deposited into the vault is maintained through user-controlled wallets and the onchain smart contract infrastructure of the Morpho protocol. Bitwise does not custody user assets.
Risk factors. Participation in DeFi lending carries material risks, including the risk of total loss of deposited assets. Risk factors include, but are not limited to:
- Smart-contract risk. This vault relies on smart-contract code that may contain bugs, vulnerabilities, or exploitable weaknesses. A smart-contract exploit could result in partial or total loss of all deposited assets. Smart-contract audits are available at https://docs.morpho.org/get-started/resources/audits.
- Collateral and credit risk. If borrower collateral values decline rapidly, liquidation proceeds may be insufficient to cover outstanding loans, resulting in bad debt allocated to depositors. The quality, liquidity, and volatility of accepted collateral types directly affects the risk profile of this vault.
- RWA-specific risk. Tokenized real-world assets carry credit, structural, and provider-specific risks, including valuation risk, custodial risk, legal and enforcement risk, and redemption risk. The collateral characteristics, default history, insurance arrangements, and structural features described above are as represented by the respective third-party providers; Bitwise has not independently verified this information and makes no representation or warranty regarding its accuracy or completeness.
- Liquidity risk. Withdrawal is subject to available liquidity in the underlying lending pool. If utilization is high, withdrawal may be delayed or temporarily unavailable.
- Oracle risk. The lending protocol relies on price oracles. Oracle failure, manipulation, or stale data could result in improper liquidations or failure to liquidate undercollateralized positions.
- Regulatory risk. The regulatory classification of DeFi lending protocols, vault interests, and digital assets is uncertain and evolving. Regulatory action may restrict, prohibit, or alter the availability or structure of this vault.
- Protocol risk. The underlying Morpho protocol is operated by third parties. Bitwise does not control the operation, security, governance, or solvency of the protocol.
- Variable yield. Yields are variable, not guaranteed, and may be zero.
- No insurance. This vault is not insured by the Federal Deposit Insurance Corporation (FDIC), the Securities Investor Protection Corporation (SIPC), or any other governmental or private insurance program. You may lose some or all of your deposited assets.
Certain information in this press release, including collateral characteristics, historical performance, default history, insurance arrangements, and structural features, is based on or derived from information provided by independent third-party sources, including the providers of the RWA collateral described above. Bitwise believes these sources are reliable but has not independently verified the accuracy or completeness of such information or the assumptions on which it is based.
Target APY of 5–6% is a current estimate based on prevailing borrower demand and market utilization as of the date of this press release. APY is variable, determined algorithmically by the protocol’s utilization-based interest-rate model, is not fixed, is not guaranteed, and may change at any time without notice. Actual yields may be materially higher or lower than the target, including zero. Past rates are not indicative of future rates.
This press release is for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any securities or financial instruments in any jurisdiction. Nothing in this press release constitutes investment, financial, legal, or tax advice. You should consult your own advisors before participating.
Use of this vault is governed by the Bitwise Onchain Terms of Use, including Schedule A: Lending Vault Terms, available at https://onchain.bitwiseinvestments.com/tos.
CONTACT:
Ryan Dicovitsky
Dukas Linden PR
Bitwise@DLPR.com
Ryan Dicovitsky
Vice President
Dukas Linden Public Relations
ryan@dlpr.com
Phone: 908-907-7703
DLPR.com
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SOURCE Bitwise Asset Management
