It's normal for the lower leaves to drop off as the plant makes new leaves up top. You've done well with it, so far BUT If you look at the bottom of the root ball, I think you will see the problem. Papayas put down a long tap root. Because of that, they very seldom succeed in pots. They want to grow out the bottom of the pot, see how most of the roots are way down there at the lower soil level?
A plastic food-grade barrel, something like people use for rain barrels, but with drainage holes in the bottom, is about what you need to grow a papaya for any length of time. The tap roots on some of mine have gone down at least 3ft. Of course, here a papaya will go from a baby to 9ft. tall with a dozen or more fruit on it in one season. In the ground, with tons of fert and water of course.
All I can advise, if you can't manage a bigger, deep planter, is lift it out of the pot, fill the bottom space of the pot with as much soil as you can, and put it back in. Looks like you have room for at least 3in, more soil in that pot or get a larger, much deeper pot. Still not a long-term solution, but at least you might get some fruit this fall before it gives up entirely. If you can get a bigger container, try to choose a light colored one, also, or paint it white if you can to keep the roots cooler when the sun shines on the side of the pot.
May I ask where you are? I see writing on your water tower in the pictures that I don't recognize. (just wondering for climate info)
