Arca to create ‘one-stop shop’ for investors after BlockTower merger

Arca CEO Rayne Steinberg talked to Blockworks about how the two made the decision to merge and their plans moving forward

article-image

Arca and Adobe stock modified by Blockworks

share

Arca and BlockTower are merging in an all-equity deal, the companies announced last week. 

Arca CEO Rayne Steinberg talked to Blockworks about the merger, timing and what this next cycle could look like. 

The two had been in talks to merge for a little over two months, Steinberg said. They’d always been close, but the merger just “made so much sense” after talks ramped up.

Aside from BlockTower’s venture team, which will be spun out, Arca and BlockTower plan to retain all their talent under one umbrella. Steinberg will lead the new company, with Jeff Dorman staying on as chief investment officer. Ari Paul, CIO and founder of BlockTower, will be moving to an advisory role, though Steinberg believes he’ll be “very involved.”

Steinberg pointed out that the two had to move quickly due to “crypto years,” which pass much faster than in other sectors. The deal is expected to close by the end of this year, and Steinberg said he couldn’t even imagine what crypto would look like if they waited another whole year to close. 

Read more: Latest crypto M&A deals signal ‘the tide is shifting’

The goal is for the new entity to become a “one-stop shop for sophisticated investors.”

And while the overall political environment wasn’t a huge factor, it’s definitely going to benefit the new company going forward. 

“We see this as a huge white space for the token market,” Steinberg told me. Previously, tokens had been “handicapped” because they haven’t been able to offer elements such as fee switches. If the regulation or enforcement actions around tokens loosen, then Steinberg is confident that he’s bringing the best team to the table. 

“It’s not just about saying that there shouldn’t be regulations or things like that, but sensible regulations that make sense,” he said.

Read more: Traders are banking on Trump’s pro-crypto action

It’s not just tokens that are going to benefit from the new environment. Steinberg said he also remains bullish on activists investing in DAOs. 

The “inefficiencies in the space” have not allowed it to “mature, in having people that drive good governance thinking about outcomes for token holders,” he said. 

“I’m not knocking any regulatory regime or thinking about that. But just when you have an environment where you’ve kind of disallowed any productive use of tokens, from fee switches to utility or things like that…contrary to what you would probably want, you create an environment where only things like memecoins have any real traction, because they literally, by definition, cannot offer anything of a tangible value.”

Arca doesn’t have any plans for “specific lobbying,” Steinberg said. But the new company will continue to be a “steward” for the industry.

With more clarity, he believes, we’ll see both traditional and activist investors get more involved which, in turn, makes him more bullish. This could also lead to further consolidation down the line as crypto readjusts in the next cycle.


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the Forward Guidance newsletter.

Get alpha directly in your inbox with the 0xResearch newsletter — market highlights, charts, degen trade ideas, governance updates, and more.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Javits Center North | 445 11th Ave

Tues - Thurs, March 18 - 20, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

recent research

Research Report Templates.png

Research

An overview of the Base Ecosystem, with a focus on market leaders.

article-image

Stanford professors David Mazières and Dan Boneh will lead the lab alongside a cohort of graduate student researchers

article-image

With more companies holding BTC, bitcoin yielding strategies could become “a new corporate finance norm,” CoinShares posed

article-image

The proposal comes after Polygon governance considered a controversial use of bridged liquidity for yield

article-image

Can the community balance its decentralized ethos with the need for inclusivity and constructive debate?

article-image

DAWN is positioning itself as a decentralized protocol for gigabit-level internet access

article-image

VanEck Ventures and VanEck’s Digital Assets Alpha Fund invested $2.5 million in DAWN through a strategic funding round, the teams exclusively told Blockworks