STEP Report - October 2024

We’re happy to present the first monthly update for Arbitrum’s Stable Treasury Endowment Program. Below please find an October month-end PDF statement and a new Dune dashboard with live data and portfolio analytics. We will continue to add performance data to the PDF statements once enough time has passed to produce useful insights.

Please let us know if there’s anything else you’d like to see in these reports or the dashboards, and we’ll do our best to include in the future!

A few notes on the portfolio:

  • Ondo’s USDY has a 45 day restriction period post-investment before the tokens can be minted, so that data will not appear in the Dune dashboard until roughly December 5th. While not yet shown, the investment is accruing interest.
  • For BUIDL, the Dune dashboard temporarily shows excess interest distributed to the STEP wallet. This interest is from other investments made by the Arbitrum Foundation and will be redistributed shortly. This will occur on a monthly basis.
  • The interest earned on Backed’s bIB01 is initially negative as a result of Backed’s subscription fee model.
  • The allocation to OpenEden’s TBILL has not yet been fully deployed. The Arbitrum Foundation is still in discussion with the OpenEden team.

Recent Product Updates

Blackrock/Securitize

Securitize recently announced that BUIDL is now operating on multiple chains outside of Ethereum mainnet, including Arbitrum. BUIDL is now live on Ethereum, Arbitrum, Aptos, Avalanche, Optimism, and Polygon. Arbitrum’s investment was initially deployed on mainnet, but the Arbitrum foundation is currently in discussion with Securitize to move the holdings over to Arbitrum.

Superstate

Superstate recently launched a new “continuous pricing” feature, which updates the price of USTB 24/7 based on calculated accrued interest of the underlying assets. Since USTB was selected for the STEP, they’ve also added on-chain proof of reserves and NAV via Chainlink and are currently working on a proof of reserve oracle with Chronicle as well.

Mountain

While Mountain was already live on multiple chains, including Arbitrum, Mountain recently enabled native cross-chain bridging with Chainlink’s CCIP. On the operational front, Mountain added Statestreet, a large global bank, as a custodian for the t-bills backing USDM.

Backed

Backed’s bIB01 recently received an A rating from Particula. They also recently enabled Chainlink’s CCIP to bring native cross-chain bridging to their suite of products, including bIB01.

OpenEden

In late October, one of the co-founders of OpenEden was dismissed following serious allegations of misconduct. OpenEden has provided a series of public updates, and Steakhouse held a call with OpenEden CEO immediately after this development to assess if there were any concerns for Arbitrum’s position. We have been assured by the Company that operations were not impacted and that OpenEden notified their regulator. The Arbitrum Foundation remains in communication with the team regarding the deployment process.

On the business side, OpenEden’s TBILL is adding an instant redemption feature, which is expected to be rolled out before the end of the year

Ondo

In August of this year, Ondo’s USDY officially launched on Arbitrum. USDY is now live on 7 different chains. In November, Ondo announced a partnership with LayerZero, bringing cross-chain bridging to the product.

5 Likes

Is there a way to move away from that? AF investments are ideally not commingled with governance investments. If you guys have to add a footnote every time you report, then that defeats the purpose of having transparent onchain investments.

2 Likes

For now, this is the only way Securitize can distribute the interest. We have raised this issue with them and will keep working toward a better solution. In the meantime, we will make sure the excess interest is redistributed as quickly as possible so that the on-chain data accurately represents the STEP portfolio.

2 Likes

When does application for new managers open or is it on an ongoing basis ?

Thanks

Update on the OpenEden allocation: Steakhouse and the Arbitrum Foundation remain comfortable with the issuer, and the full deployment to OpenEden’s TBILL will be made in the near future.

The STEP application process is currently complete, but if there is a “STEP 2” proposal, more information will be posted on the forum.