Treasury Management
During the month of April, the wider DeFi ecosystem experienced another notable hack. Kelp’s rsETH OFT was exploited, enabling the attacker to release rsETH from the mainnet bridge without any tokens being burned on other chains. Neither the TM portfolio nor the wider DAO treasury experienced any losses due to the abovementioned incident. Shortly after the exploit was quickly identified and flagged by Entropy Advisors, ~3.5K wstETH was withdrawn from the Aave Arbitrum instance. We also posted an in-depth update following the incident.
The DeFi United initiative has since been stood up with the goal of restoring the backing of rsETH through ETH contributions. Pertaining to Arbitrum, the security council executed an emergency action to freeze ~30,765 ETH held by the exploiter on Arbitrum One. The Arbitrum DAO is currently in the voting process regarding whether or not to release the frozen ETH into DeFi United. More information is available in this forum post.
The phased withdrawal process from Gauntlet’s USDC Prime Vault on Morpho was finalized during the month. ~$4M was withdrawn from the vault. The TM portfolio was also upsized by ~$56K from unused funds related to the legacy ADPC Subsidy Fund initiative. The deployment into syrupUSDC was initiated in April with the aforementioned funds, together with USDC proceeds from the DAO’s covered calls strategy on ETH as well as incentive token rebalances. The deployment was finalized on May 5th, with the DAO now holding ~$5.8M worth of syrupUSDC.
~$9.2M was received from USTB and bIB01 withdrawals during the month. These proceeds were earmarked for supporting ecosystem growth through a deployment with USDai. ~$1M was deployed during April, and the rest of the earmarked funds on May 5th.
On the ETH deployments front, the DAO received 0.32 stETH as part of Lido’s Rewards-Share Program. The kickback covers the Q1 2026 period.
In late April, the OAT approved a phased wind-down of KPK’s active management services. The decision was driven by efforts to streamline operations and ensure cohesion of deployments across the whole TM portfolio, not the active manager’s net performance. The ATMC would like to extend its sincere appreciation for the productive collaboration, as well as for the services and expertise provided by KPK throughout the engagement.
Finally, Entropy posted a proposal to expand the TM portfolio with 6K ETH and ~$150K stablecoins from the DAO treasury. Voting ended on May 8th and the proposal passed with ~194M votes FOR.
Incentives: DRIP
April continued to be a quiet month for DRIP, as partnership negotiations are still ongoing. Additionally, users have until EoD May 18th, 2026, to claim rewards from all participating protocols, with the exception of Aave, which carries an extended deadline through EoD August 18th, 2026. Participants in DRIP Season 1 can claim their rewards on arbitrumdrip.com.
Ecosystem Data
Arbitrum GTM Support:
- Social Media Campaigns:
The Data Team:
- DeFi United Dashboard: Built a dedicated dashboard to track contributions and raise awareness for the DeFi United initiative. Beyond supporting the campaign, it serves as a broader signal of Arbitrum’s presence and coordination capacity within the wider DeFi ecosystem.
- ArbOS 60 Research: Supported Offchain Labs with research and analysis on ArbOS 60, focused on finding the right balance between scalability and long-term revenue sustainability for the network.
- Onchain Governance Module: Launched the onchain proposal and security council module on arbdata.com, giving delegates and the broader industry a single place to track voting activity, quorum progress, and DAO analytics across Arbitrum governance.
Governance Operations & Other Initiatives
Stylus Sprint
In April, 430,000 ARB was disbursed to teams at an average price of ~$0.109 (~$46,744.60). This brings the total amount of ARB distributed to teams to ~6.86M (76.2% of the 9M budget). The committee has wrapped up its initial review of all milestones, but there are 3 teams working on implementing feedback before payments will be completed. We anticipate that the Stylus Sprint will distribute 7.36M ARB of its budget.
OCL marketing recently released a blog post highlighting StylusPort. They are also finalizing the post for Moving Stylus and have passed along an initial draft of a post to Syndicate for their review.
Watchdog
In April, Entropy published the Watchdog Program 6-Month Retrospective, followed by an April 20th update, which introduced a time-frame limit on eligible reports (effective May 10th at 11:59pm UTC, excluding pre-2025 programs), a 3-month KYC deadline post-case-closure, and confirmation that OpCo will take over some program operations going forward.
We also recently published a month-end update for the program’s finances and total case load as we shift from a mid-month reporting cadence to end-of-month data. The program received 8 new reports, all involving the historic inventive programs and mostly tied to minor administrative errors such as late distributions of user funds to distributor contracts. The committee has now closed nearly all of its outstanding investigations, with only 2 still under review at this moment. The Watchdog Program totals now stand at 86 reports, 67 unique cases, 65 investigations completed (42 valid misuse, 23 not valid), and 457,365 ARB recovered. The working budget sits at ~476,481 ARB.
SeedGov announced an internal restructuring that led the organization to step down from its role in the Watchdog. However, Ministro will continue to fill the same responsibilities, just in an individual capacity. As program manager, Entropy felt that no other actions or replacements were necessary. Additionally, OpCo has been onboarded to the Globaleaks platform and is familiarizing themselves with the system, with the current reviewing committee continuing alongside them through the transition.
Requests from the DAO
Please continue to reach out and pass along requests to Entropy Advisors, or visit our bi-weekly office hours on Tuesdays at 1:15pm EST. Our team is always open to input from DAO members and encourages delegates to use this time to ask Entropy questions regarding any initiative.