Pharos Network Joins Forces with Morpho to Unveil Indigenous Real-World Asset Lending Infrastructure
Pharos Network, a Layer-1 blockchain focused on real-world asset finance (RWAfi), has partnered with Morpho, a lending network with over $9 billion in deposits, to create a more transparent and capital-efficient on-chain credit ecosystem.
This collaboration integrates Morpho’s advanced, modular lending infrastructure natively into Pharos’s blockchain, serving the RWA market. The partnership aims to build a risk-isolated, capital-efficient lending engine directly on-chain, designed specifically for tokenized real-world assets like mortgages and trade receivables.
The integration contributes to institutional-grade lending by enabling vault-level risk isolation, enhanced capital efficiency, native DeFi infrastructure for RWAs, support for complex credit strategies, and regulatory and custody integration.
Vault-level risk isolation separates lending pools (vaults) for each asset type, preventing loss spillover across different asset classes, which is crucial for institutional risk management. Enhanced capital efficiency allows lenders and asset originators to access tailored credit markets with lower spreads and better risk pricing, improving yield opportunities in a transparent and scalable environment.
Native DeFi infrastructure for RWAs embeds Morpho’s deposit-backed lending protocol into Pharos’s blockchain, bringing DeFi composability and transparency to traditionally off-chain assets. The combined technology stack allows flexible and modular credit solutions that can meet diverse institutional requirements while maintaining openness typical of DeFi systems.
Regulatory and custody integration ensures the platform can offer compliant, secure custody and credit modeling, further facilitating institutional trust and participation.
The partnership is positioned to bridge traditional finance and decentralized finance, making blockchain-based lending for real-world assets scalable, transparent, and accessible to both institutional and retail markets while protecting against systemic risk through modular loan pools. This infrastructure aims to be a cornerstone for the growing $25B RWA market, providing a trusted, on-chain credit ecosystem tailored for institutional-grade asset-backed lending.
The explosive growth of the RWA market has been previously covered on our website, with projections showing it could reach $600 billion by the end of the decade. The collaboration between Pharos Network and Morpho marks an inaugural step towards institutional-grade lending rails in the RWA ecosystem.
The partnership strengthens the broader RWAfi strategy alongside peers like Ant Digital, R25, and Gauntlet.
[1] Pharos Network press release [2] Morpho press release [3] Interview with Wish Wu, CTO and Co-Founder at Pharos [4] Interview with Kirk Hutchison, CEO of Morpho [5] Data from rwa.xyz shows that institutions have an uncontested lead in the inflow of funds in the RWA sector.
- This partnership between Pharos Network and Morpho aims to build a risk-isolated, capital-efficient lending engine directly on the blockchain, marking a significant step towards institutional-grade lending for real-world assets like mortgages and trade receivables, merging traditional finance with decentralized finance.
- The integration of Morpho's advanced, modular lending infrastructure into Pharos's blockchain not only creates a more transparent and scalable environment for real-world asset finance (RWAfi), but also embeds DeFi composability and native support for complex credit strategies, contributing to the growing $25B RWA market and potentially reaching $600 billion by the end of the decade.
