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Las Vegas, January 14, 2026.
New York-based investment firm ATW Partners has committed up to $50 million to Frax's frxUSD stablecoin, with BitGo handling qualified custody.
This deal merges traditional finance (TradFi) with decentralized finance (DeFi), enabling seamless on-chain dollar usage for institutions.
Frax oversees reserves, fully backed by tokenized U.S. Treasury holdings through WisdomTree's WTGXX on the FraxNet platform.
The collaboration promotes efficient, transparent financial tools amid rising stablecoin adoption.
Key Takeaways
- ATW Partners deploys $50M into frxUSD for TradFi-DeFi bridging.
- BitGo delivers secure, compliant custody for institutional holdings.
- frxUSD reserves tokenized via WisdomTree WTGXX for full backing.
- Enables rapid minting, redeeming, and activity-based rewards.
- Future growth focuses on B2B cases and TVL expansion.
Partnership Details
ATW Partners will allocate the funds via affiliates and portfolio companies into frxUSD, a dollar-pegged stablecoin. BitGo Bank & Trust provides custody to meet institutional compliance and security needs.
Users can mint, redeem, and earn rewards on frxUSD activities, surpassing traditional finance in speed and cost. Reserves are tokenized with partners like WisdomTree, offering direct Treasury exposure.
This allows blockchain benefits like instant settlements while ensuring regulatory alignment.
The focus includes B2B payments, investments, and on-chain operations to overcome TradFi-DeFi divides.
Industry Context
Stablecoins hold over $150 billion in market cap as of early 2026, providing volatility hedges with real-asset backing. frxUSD emphasizes full Treasury reserves and auditability, differing from past models under reserve scrutiny.
U.S. regulations now support digital assets, drawing institutional interest.
ATW leverages stablecoins for capital efficiency, while BitGo offers segregated accounts and audits. This reflects a shift where TradFi adopts DeFi for liquidity and yields.
Quotes from Key Stakeholders
Sam Kazemian, Frax Founder: "ATW and BitGo demonstrate modern institutions embracing stablecoins. frxUSD and FraxNet enable minting, redeeming, and rewards, delivering DeFi's speed over legacy systems."
Nathan Stump, BitGo FinTech Director: "Our custody for frxUSD shows how custodians enable tokenized asset adoption. ATW gains on-chain efficiency with institutional transparency and controls."
ATW Partners representative: "This aligns with our digital asset strategy via Frax. We bridge TradFi to on-chain, adding institutional use cases for frxUSD—moving dollars swiftly with reserve backing and top custody."
Future Outlook
The partners will expand soon, targeting more institutional flows and B2B frxUSD applications. Plans include TVL growth and features for HNWIs and enterprises, enhancing payments, lending, and transfers.
About the Companies
- ATW Partners LLC, founded 2016, is a multi-strategy manager with affiliate ATW Partners Opportunities Management LLC, focusing on market innovations.
- BitGo, since 2013, offers digital asset services like custody and trading from regulated storage, serving institutions globally in the digital economy transition.
- Frax builds stable digital money infrastructure: frxUSD backed by Treasuries via BlackRock and Superstate; Fraxtal for scalable blockchain; FraxNet for institutional minting and earning.
Conclusion
ATW's $50M frxUSD investment with BitGo custody accelerates stablecoin use in institutional finance, enhancing efficiency.
Read Next:
- 12 Best Stablecoin Aggregators to Use in 2026
- What Are the Risks of Staking Stablecoins in 2026?
- Best Chain for Stablecoin Micropayments in 2026
FAQs:
1. What is frxUSD and how is it backed?
frxUSD is Frax's U.S. dollar-pegged stablecoin, fully backed by tokenized U.S. Treasuries through partners like WisdomTree's WTGXX, ensuring 1:1 stability and on-chain transparency.
2. How does BitGo's role enhance the partnership?
BitGo provides qualified custody services, offering institutional-grade controls, segregated accounts, and audit trails to secure frxUSD holdings while enabling compliant on-chain workflows.
3. What specific benefits does ATW Partners receive from this investment?
ATW gains access to fast, low-cost on-chain dollar transfers for its affiliates and portfolio companies, with full reserve backing and secure custody to align with institutional standards.
4. Why is this partnership a milestone for the stablecoin sector?
It bridges traditional finance with DeFi, demonstrating how institutions can adopt stablecoins for real-world use cases like B2B payments and investments, amid growing regulatory support.
5. What are the planned expansions for ATW Partners and Frax?
The duo aims to increase institutional investments, develop more B2B applications for frxUSD, boost total value locked (TVL), and introduce features for high-net-worth individuals and enterprises.
Disclaimer:
This content is provided for informational and educational purposes only and does not constitute financial, investment, legal, or tax advice; no material herein should be interpreted as a recommendation, endorsement, or solicitation to buy or sell any financial instrument, and readers should conduct their own independent research or consult a qualified professional.
