Two Prime launches $10M-backed Bitcoin yield vault

Two Prime has launched an institutional Bitcoin lending vault on Pareto targeting annual returns of 1.5% to 2%, with roughly $10 million of the firm’s own capital committed to absorb initial credit losses. Summary Two Prime launched a Pareto WBTC vault targeting 1.5% to 2% annual institutional lending yields. Two Prime committed roughly $10 million in first-loss capital to absorb initial borrower credit losses. The Axiom vault requires at least five WBTC, placing entry near $380,000 at current prices. ICE Digital Trust and Copper Technologies will provide custody for assets supporting the lending strategy. Pareto currently tracks roughly $227 million in active private-credit loans across its onchain credit infrastructure. CoinDesk reported on Sept. 16 that the Axiom WBTC Yield Vault accepts Wrapped Bitcoin and requires a minimum investment of 5 WBTC, putting the entry level near $380,000 with Bitcoin trading around $76,000 at publication. The quoted yield is a target tied to lending conditions and is not guaranteed. The product takes Two Prime’s existing institutional credit business onto blockchain-based infrastructure, with Pareto handling the private-credit rails and ICE Digital Trust and Copper Technologies providing custody. Two Prime plans to lend deposited assets to institutional counterparties that can include public companies, credit-rated borrowers and diversified financial firms. You might also like: Two Prime crosses $2.55b milestone in Bitcoin-backed loans Two Prime puts $10 million behind the WBTC vault Two Prime’s capital commitment gives the Axiom vault a first-loss layer before participating investors bear certain credit losses. CoinDesk placed the commitment at roughly $10 million, although the report did not disclose the precise size of the vault, its maximum capacity or how much of that capital had already been deployed when the product was announced. The structure does not make the targeted return risk-free. Its 1.5% to 2% annual return depends on lending terms, borrower performance and market conditions. Investors retain exposure to credit risk, operational risk and risks tied to the wrapped Bitcoin used as the vault’s deposit asset. Five WBTC is the minimum contribution. At a Bitcoin price close to $76,000, that represents approximately $380,000, although the dollar amount changes with Bitcoin because WBTC is designed to track the underlying asset. Wrapped Bitcoin allows BTC value to move through smart contracts on networks such as Ethereum. The token is backed by Bitcoin held in custody, creating an additional custody and tokenization layer that does not exist when an investor holds native BTC directly. As crypto.news explained in its recent WBTC guide, WBTC brings Bitcoin liquidity into lending and other decentralized-finance applications through a token intended to maintain a one-to-one relationship with BTC. The structure comes with custodial and smart-contract considerations that differ from native Bitcoin ownership.