As signs of strain emerge in the crypto market, the Arbitrum DAO voted to be prudent, opting to diversify its treasury by allocating a substantial amount of its ARB tokens to tokenized real-world assets (RWAs).

Results indicated overwhelming support, with over 181 million ARB backing the initiative, compared to only 7.45 million against it.

Arbitrum DAO Diversifies With Tokenized RWAs

The proposition to expand the ARB treasury with RWAs surfaced in late January 2027, with voting taking place from January 31 to February 15. Due to significant backing from ARB holders, the execution occurred on February 18. The initial impact has already been tested with no apparent threats detected.

Arbitrum is now committing 35 million ARB to RWAs, which is expected to increase the DAO’s overall allocation to 85 million, positioning Arbitrum among the largest DAOs engaged in RWA investments.

Supporters believe that the triumph of the first phase of the Stable Treasury Endowment Program (STEP) attracted institutional interest. Thus, this decision could potentially accelerate the growth of Arbitrum and its RWA framework.

By investing in tokenized U.S. Treasuries provided by BlackRock’s BUIDL and products from Ondo Finance, the DAO seeks to mitigate ARB’s volatility.

This strategy ensures that Arbitrum continues to earn yields from RWA investments, irrespective of market prices. STEP 1 has already generated over $450,000 in interest for the DAO, funds that could help cover operational expenses.

Additionally, this decision aligns with broader trends. Since early 2024, the RWA sector has seen rapid growth, expanding from around $100,000 to almost $70 million, reflecting strong investor confidence.

BoLD Activated, Will ARB Recover?

On the security front, Arbitrum introduced Bounded Liquidity Delay (BoLD) last week. This feature allows completely permissionless validation for Ethereum layer-2 while maintaining fast dispute resolutions. Arbitrum confirmed that BoLD underwent rigorous testing and is secure, providing defenses against attacks.

Quotes

From a security perspective: BoLD is designed to confiscate the bonds from failed attackers, while honest validators get reimbursed. — Arbitrum Developers (@ArbitrumDevs) February 12, 2025

This system creates a substantial economic deterrent against malicious activities while safeguarding honest participants.

Moreover, BoLD allows for parallel challenge resolutions, capping withdrawal delays at a maximum of 12.8 days amidst disputes.

While these advancements indicate a positive outlook, ARB remains under pressure. The token risks falling below $0.40, hitting multi-month lows and extending losses from 2024.

Bulls must step in as prices plummeted on February 18, with resistance at $0.52 that needs breaking to elevate the token.

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