Tharwa introduces a novel RWA-backed stablecoin model that solves the problem of tokenizing multi-asset funds, whilst simultaneously overcoming the limitations of algorithmic or over-collateralized crypto-backed stablecoins. This is complemented by AI and quantitative auto-rebalancing strategies to maximize yields and minimize risk for the underlying funds. By creating the architecture for tokenizing funds that have a diversified, multi-asset backing, Tharwa delivers an improved risk profile compared to tokenized funds with single-asset backing. It also enables consistently higher yield that beats both Tradfi and on-chain funds via the most diversified mix of on-chain and off-chain assets. The AI-based auto-rebalancing strategies then amplify both these benefits. In doing so, Tharwa offers retail access to financial opportunities that are usually outside their reach either in the on-chain or off-chain world.