Bitwise Asset Management’s newest onchain product has hit a notable milestone. The Bitwise Premium RWA Vault, ticker PAPY, crossed $12 million in total value locked shortly after launch, reaching $13.267 million by September 10, 2026, according to vault data.
For context on the speed: the vault launched on September 2, 2026, started with roughly $639K in deposits, crossed $8 million within its first 24 hours, and kept climbing from there.
What PAPY actually does
The vault lives on Ethereum and runs on top of Morpho, a non-custodial lending protocol. Users deposit Agora’s AUSD stablecoin into an ERC-4626 vault, and the protocol then lends those funds against a curated basket of tokenized real-world assets.
The collateral basket currently includes three assets. Huma Finance’s PST, which finances short-duration cross-border payment flows, makes up about 39.74% of the allocation. Hastra’s PRIME, backed by home equity claims, represents roughly 26.29%. sUSDai, which supports GPU-backed loans, accounts for approximately 21.26%, with the remainder sitting unallocated.
Bitwise controls the governance parameters, meaning it decides which assets qualify as collateral, what loan-to-value ratios apply, and how interest rates are modeled. But it never takes custody of deposited funds. Those remain within user wallets or Morpho’s contracts throughout.
The target yield is a variable 5-6% APY. As of September 10, 2026, the instant net APY sat at 4.27% and the seven-day average hovered around 4.07%. The vault charges a 0.39% management fee and carries no performance fee, with a capacity ceiling near $1 billion and no lock-up period.
The broader RWA play
Bitwise manages more than $9 billion in client assets. AUSD, the deposit currency, is Agora’s stablecoin backed by short-term US Treasuries, overnight repo, and other liquid assets.
What to watch going forward
The vault’s capacity is set near $1 billion, so the current $13 million in TVL represents a fraction of the room available.
The collateral composition is also worth watching. The current allocation leans heavily on Huma’s PST, and any credit event or liquidity stress in cross-border payment financing could test how well Morpho’s liquidation mechanics handle less liquid RWA collateral compared to standard crypto assets.
The 4.07% to 4.27% yield range is competitive relative to US Treasury rates but not dramatically higher.
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