Quick Breakdown
- Global asset manager Bitwise has officially entered the decentralised finance (DeFi) market by joining the Morpho network as a vault curator.
- The firm’s first on-chain strategy targets an annual percentage yield (APY) of up to 6% on the USDC stablecoin through over-collateralised lending.
- This move signals a shift towards “ETFs 2.0,” where professional managers layer risk oversight onto non-custodial, programmable blockchain infrastructure.
Bitwise Asset Management, a firm managing over $15 billion in assets, announced on Monday that it has launched its first on-chain vault strategy through the Morpho lending protocol.
By becoming a vault curator, Bitwise now provides institutional-grade risk management for non-custodial lending, allowing investors to earn digital yield without the complexity of manual on-chain management. The initial strategy focuses on the USDC stablecoin, deploying capital into isolated lending markets where every loan is backed by excess collateral.
The partnership leverages Morpho Blue’s modular architecture, which allows curators like Bitwise to define specific risk parameters, such as collateral requirements and exposure limits. Jonathan Man, Bitwise’s Head of Multi-Strategy Solutions, noted that while DeFi offers compelling opportunities, the “complexity of managing on-chain risk” has previously kept many investors on the sidelines. Bitwise aims to bridge this gap by providing professional guidance alongside transparent, automated smart contracts.
Institutional shift towards on-chain curation
This launch reflects a broader trend of traditional financial giants moving beyond simple spot ETFs into active on-chain participation. Bitwise recently that assets under management (AUM) in on-chain vaults would double in 2026, even referring to the tech as “ETFs 2.0” due to its transparency and real-time settlement. Unlike traditional funds, these vaults allow users to retain custody of their assets, with the curator managing the strategy rather than the funds themselves.
Building on a foundation of digital leadership
By targeting a 6% yield in a transparent, over-collateralised environment, Bitwise offers a competitive alternative to traditional money market funds, which typically yield between 4% and 5%. Looking ahead, the firm has suggested it may expand into real-world asset (RWA) tokenization and decentralised exchange (DEX) liquidity provision, further blurring the lines between legacy finance and the on-chain economy.
This strategic vault launch aligns with its own bullish prediction that 2026 will “belong to the bulls.” By providing institutional access to DeFi yields in an environment signalling a Q4 2025 bear-market bottom, the firm is positioned for significant growth amid accelerating institutional inflows and an anticipated market recovery.
If you would like to read more articles like this, visit Morpho.
Take control of your crypto portfolio with MARKETS PRO, Morpho’s suite of analytics tools.”