ArbitrumDAO Strengthens On-Chain Investment Strategy with STEP 2 Program

The Arbitrum Foundation has unveiled the next phase of its Stable Treasury Endowment Program (STEP), marking a pivotal moment in the integration of on-chain assets. This initiative aims to amplify the adoption of Real-World Assets (RWAs) through strategic collaborations with prominent financial institutions: Franklin Templeton, Spiko, and WisdomTree. With a noteworthy allocation of $35 million in $ARB tokens dedicated to tokenized U.S. treasury products, this expansion highlights Arbitrum's commitment to positioning itself as a trailblazer in the cryptocurrency space.

Initially launched in July 2024, the STEP program serves as a first-of-its-kind effort driven by ArbitrumDAO to efficiently deploy treasury capital into RWAs. Since its inception, the program has already seen remarkable results, generating nearly $700,000 in passive yield from over $30 million in initial tranches. This has played a significant role in promoting the on-chain adoption of institutional-grade assets such as BlackRock’s BUIDL, Ondo’s USDY, and Mountain Protocol’s USDM.

Following a comprehensive Request for Proposal (RFP) process that evaluated over 50 submissions, the DAO has recently confirmed its allocations for STEP 2. Notably, these include:

- 35% to Franklin Templeton's FOBXX (tokenized as BENJI)
- 35% to Spiko's USTBL
- 30% to WisdomTree's WTGXX

These selections ensure that each of the participating issuers not only provides regulated tokenized access to short-duration U.S. Treasuries but also enhances the on-chain liquidity and security associated with Arbitrum's treasury reserves.

Matthew Fiebach, Co-Founder of Entropy Advisors, commented on this landmark collaboration, stating, _“Having organizations like Blackrock, Franklin Templeton, Spiko, and WisdomTree interacting with a DAO publicly in a forum is an unbelievable accomplishment for the whole crypto space.”_ He further emphasized that Arbitrum has positioned itself at the forefront of the convergence between crypto and traditional finance, citing STEP as a prime example of this ongoing evolution.

The latest allocation underlines STEP's overarching mission: to cultivate a yield-bearing, composable, and sustainable treasury. With over $45 million already deployed across eight issuers and more than $240 million in RWAs held on Arbitrum-based platforms, the initiative illustrates a spectacular growth trajectory, reflecting more than a 50x increase over the past year

The organizations selected for allocation expressed excitement and optimism about their role in the STEP 2 program. Roger Bayston, Head of Digital Assets at Franklin Templeton, stated, _“We are thrilled to be selected as a manager for the STEP 2 program. By leveraging Arbitrum’s leading Layer 2 technology, we can deliver faster, more scalable, and cost-efficient solutions to our clients.”_

Spiko’s CEO, Paul Adrien, echoed this sentiment, adding, _“Being selected by the STEP 2 committee is a powerful endorsement of our mission to deliver secure, regulated, on-chain treasury solutions that are accessible to all.”_ Spiko, known for launching Europe’s first tokenized UCITS funds on public blockchains, has rapidly secured over $260 million in assets under management since its inception in mid-2024.

Maredith Hannon, Head of Business Development at WisdomTree, also highlighted the importance of this collaboration, stating, _“Expanding access to tokenized RWAs is central to our mission, and this opportunity with Arbitrum enhances the demand for institutional-grade digital assets.”_

The STEP program stands as a dynamic solution to idle capital inefficiencies while simultaneously strategizing for the ArbitrumDAO's future diversification into various asset classes, including early-stage ventures, credit strategies, and commodities. This comprehensive approach not only embodies the spirit of innovation that defines Arbitrum but also solidifies its role as a leader in the rapidly evolving landscape of digital finance.

To explore more about Arbitrum's innovative initiatives, please visit arbitrum.io.

About Arbitrum

Arbitrum is a highly customizable and interoperable set of solutions aimed at transitioning businesses and individuals on-chain. The flagship blockchain, Arbitrum One, leads the L2 Total Value Locked (TVL) landscape with superior liquidity, facilitating the development of decentralized applications (dApps) across various sectors, including DeFi and gaming. Solutions like Orbit and Stylus exemplify Arbitrum's commitment to driving innovation in blockchain technology, ensuring its position at the forefront of the industry.