- ArbitrumDAO allocates 35M ARB to accelerate RWA institutional adoption via STEP 2.
- Franklin Templeton, Spiko, and WisdomTree secure 35M ARB for tokenized U.S. Treasurys.
- ArbitrumDAO’s STEP program boosts treasury with 35M ARB targeting yield growth.
The Arbitrum DAO has approved the next step of its Stable Treasury Endowment Program (STEP)—a significant step towards expanding its treasury into tokenized U.S. treasuries. The DAO distributed 35 million ARB, equivalent to $11.6 million, to 3 institutional partners. Franklin Templeton, Spiko, and WisdomTree.
Having received over 50 submissions from different issuers, this decision has been confirmed after a full review, solidifying the DAO’s focus on securing regulated, yield-bearing assets for its treasury.
Details of the STEP 2 Allocation
As part of the STEP 2 initiative, the Arbitrum DAO allocated 35% of the funds to Franklin Templeton’s FOBXX, which is tokenized as BENJI, and another 35% to Spiko’s USTBL. The remaining 30% was allocated to WisdomTree’s WTGXX.
These allocations are part of a strict request for proposal (RFP) process, intending to achieve a balance of risk-adjusted return, fee, and overall community participation. After evaluating the proposals, a committee comprised of members elected from the community made the final selection.
This move is a notable advancement for Arbitrum, which has long been at the crossroads between cryptocurrency and traditional finance (TradFi). Matthew Fiebach, co-founder of Entropy Advisors, refers to the involvement of Franklin Templeton, Spiko, and WisdomTree in an initiative led by DAO as a milestone for the crypto industry.
The Growing Market for Tokenized U.S. Treasuries
The STEP program, unveiled in July 2024, is intended to diversify Arbitrum’s treasury with tokenized real-world assets (RWAs), mainly short-duration U.S. Treasuries. The DAO’s initial investments have yielded approximately $700,000 in yield, with over $30 million invested into products like BlackRock’s BUIDL, Ondo’s USDY, and Mountain Protocol’s USDM.
Tokenized U.S. Treasuries are increasing in interest, with BUIDL’s BlackRock leading with over $2.8 billion in assets under management. Followed by Franklin Templeton’s BENJI, the second-largest tokenized offering at $763 million in AUM. Interest has grown in the market as more institutions seek to tap into the benefits of using blockchain technology to navigate the requirements of maintaining a secure, compliant, and liquid asset structure.
Future of the STEP Program and Arbitrum’s Treasury Expansion
With this new allocation, Arbitrum DAO has deployed over $45 million across eight issuers, reaffirming its real-world asset adoption commitment. Over the past year, Arbitrum has experienced a 50-fold increase in RWAs held on its blockchain.
This success places the DAO in a position to continue to grow, entering into early-stage ventures, credit strategies, and commodities. The STEP program also addresses idle capital inefficiencies, making better use of treasury funds while generating passive yield.
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