Project summary and impact
Paros is a non-custodial execution and automation platform for institutional capital, with Arbitrum as its primary orchestration layer. We built automated, policy-governed execution from MPC wallets into Arbitrum DeFi, and secured letters of intent for USD 10m of capital to deploy through Paros on Arbitrum. Paros is currently in private beta.
What we delivered
- Arbitrum integrations: Aave V3, the Gauntlet USDC vault and Ostium, each with full deposit, withdrawal and position-tracking flows from self-custodial MPC wallets. Aave V3 is live; Gauntlet and Ostium were later delisted after exploits, as a security precaution.
- Automated capital management: scheduled and market-triggered buying and selling, portfolio rebalancing to target weights and yield allocation, with gas reserve protection, gas price limits and an emergency pause.
- Hyperliquid module: a four-phase rollout, with Phase 1 built and in internal testing. Hyperliquid uses Arbitrum as its primary bridge for deposits and withdrawals, creating a further pathway for Paros to drive Arbitrum activity.
- Policy enforcement: every transaction is checked against client policy before signing; out-of-policy actions are blocked and logged.
- Metrics dashboard: a private dashboard, provided to the Arbitrum DAO, tracking value secured, wallets, transactions and per-protocol breakdown on Arbitrum.
- Institutional pipeline: LOIs totalling USD 10m intended for deployment on Arbitrum.
Impact on Arbitrum. Paros makes it simpler and more efficient to allocate capital to, and between, Arbitrum DeFi venues. Institutions set strategies and policies once; Paros then deploys, rebalances and reallocates automatically, with risk controls built into every action. This brings a level of sophistication in capital management that DeFi has largely lacked, keeps capital productive rather than idle, and lowers the operational cost of participating in the Arbitrum ecosystem.
How the grant helped. The grant funded the engineering of our first Arbitrum integrations and the automation and risk controls that now underpin the product.
Performance against KPIs
| KPI | Projected | Actual |
|---|---|---|
| Total Value Secured (committed) | $3m to 5m | $10m |
| Arbitrum protocol integrations | 3 | 4 |
Explanation: LOI commitments from hedge funds and partners intending to deploy capital on Arbitrum through Paros. Live usage is limited while Paros is in private beta.
Qualitative impact and community feedback
Most significant outcome.
The grant took Paros from proof of concept to a working product on Arbitrum, and that product has drawn demand from the most sophisticated end of the market. Hedge funds that would otherwise build this capability in-house have committed to run their strategies on Arbitrum through Paros.
Feedback from participants
“Paros will be the institutional face of DeFi.” Crypto market maker
“This is what I dreamed of creating for trading crypto.” BNY quant trader
Financial summary
Grant funds were spent on engineering: building the Aave V3, Gauntlet and Ostium integrations, the automation engine and risk controls, infrastructure and mainnet testing on Arbitrum, and the metrics dashboard provided to the DAO.
There was no meaningful difference from the original budget plan. Beyond the proposed scope, we also built Phase 1 of a Hyperliquid module.
Future plans and ecosystem alignment
Our next priority is completing audits, exiting beta and converting committed capital into live value secured on Arbitrum.
Expanding the original idea. We are moving from treasury automation towards a full operating layer for asset managers, enabling them to run automated strategies across their clients’ accounts, including separately managed accounts. We also plan to complete internal testing of the Hyperliquid module, launch it to clients and develop it further based on their feedback, and to add privacy-preserving deployment with Armada so institutions can use Arbitrum DeFi without exposing their balance sheet.
Continued engagement with Arbitrum. We will continue to build on Arbitrum, adding further venues that meet our security criteria, including tokenised treasuries and other RWA products, as the ecosystem’s institutional offering develops. We welcome introductions to Arbitrum protocols seeking institutional distribution; listing on Paros is subject to our due diligence.
Final remarks
We thank the Arbitrum DAO for its support throughout the grant. A personal thank you to Castle Labs. They were a pleasure to work with: consistently supportive, and true to the ethos and spirit of crypto throughout.