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      Bitwise Launches PAPY Vault on Circle’s Arc for USDC Lending

      Bitwise Asset Management has introduced its Premium RWA Vault, known as PAPY, on Circle’s Arc blockchain, coinciding with the public mainnet launch on September 16, 2026. The PAPY-USDC vault is designed to lend USDC against tokenized real-world assets (RWAs) and currently leads the yield rankings among Morpho vaults, offering a net annual percentage yield (APY) of 4.79%.

      The PAPY-USDC vault operates on the Morpho lending protocol, utilizing its Vault V2 architecture. Users can deposit USDC, which is then lent out to borrowers who provide RWAs as collateral. These loans are overcollateralized, requiring borrowers to lock up more value than they borrow, thereby providing a safety net for lenders. The vault accepts collateral such as Huma Finance’s PST and sUSDai, and may also engage with cirBTC markets.

      As of early October 2026, the vault reported a net APY ranging from 4.8% to 5.55%, with a management fee of approximately 0.39-0.4% and no performance fee. The vault's capacity is capped at around $1 billion, and it currently holds between $418,000 and $422,000 in USDC deposits. Unlike traditional investment vehicles, there are no lock-up requirements, allowing depositors to withdraw funds based on available liquidity.

      This launch follows Bitwise's earlier introduction of a PAPY vault on Ethereum, which garnered over $20 million in deposits within two weeks of its September 2, 2026 launch. The expansion to Arc highlights Bitwise's strategy to leverage Morpho's infrastructure across multiple networks, enhancing opportunities for decentralized finance (DeFi) lending and RWA yield generation.

      © 2026 KLEA News. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

      Source: KLEA News

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