Full story
Pencil’s $1M Student Loan
Pencil Finance completed a $1 million onchain student loan cycle, deploying $1 million of lender capital on-chain and using borrowers’ repayments to flow back to funders through a structured yield distribution.
“Pencil described the milestone as its first"fully onchain" student loan cycle”
The cycle supported around 6,600 students across 118 schools and universities in Southeast Asia, with about 1,050 receiving direct funding under the program.
Pencil said the July 2025 bundle was funded by Animoca Brands, Open Campus, and New Campus and was organized into a senior tranche with fixed returns and a junior tranche with variable returns and first-loss risk.
The protocol framed the deployment as its first “fully onchain” student loan cycle, where the lending cycle is executed and tracked on-chain through recorded transactions rather than relying entirely on traditional reporting channels.
Tranches and Tokenized Credit
Pencil’s announcement described the tranche structure as a waterfall design, with the senior tranche offering fixed returns while the junior tranche carried variable returns and bore first-loss risk.
The company positioned the onchain recording as a transparency proof point for credit, saying participants can follow the protocol’s operations through recorded transactions rather than relying entirely on traditional reporting channels.
The reporting also tied the milestone to broader interest in tokenized real-world assets (RWAs) for lending, noting that tokenized RWAs are increasingly being used to issue or collateralize loans.
In a separate example cited alongside the student-loan effort, Brazil’s B3 stock exchange issued a 100,000 Brazilian reais (about $19,600) loan secured by 10 tokenized cows, with each cow linked to a unique digital token tied to an encrypted digital identity and monitored by AI-powered smart collars from Cowmed.
Broader Crypto and Markets
Beyond Pencil Finance’s student-loan milestone, the Crypto Economy roundup said Morpho hit a $5B loan milestone and recorded an all-time high volume of $5 billion in active debt on September 1, 2026.
“Term Finance lost approximately $8.5M after an attack”
The same roundup also said Term Finance lost approximately $8.5M after an attack in which an external actor acquired majority control of its governance token and stole 2,843 Nexo Rolls Out Regulated Crypto‑Collateral Credit in Australia to Expand User Liquidity Options.
In parallel, the Crypto Briefing item described Schroders Plc increasing holdings in US Treasuries as yields neared peak, with US Treasury yields surging above 4.5% in April 2026 due to geopolitical tensions.
Crypto Briefing added that Schroders maintained approximately 16% of its portfolio in US Treasuries as of July, while it upgraded its multi-asset outlook for US government bonds in late August and early September based on elevated real yields improving the valuation case.