Institutional staking will only take off if asset lock-up is resolved: Coinbase CFO
Coinbase's new institutional staking product will not be a "short-term phenomenon" while liquid staking is still in progress elaboration.
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Institutional staking of crypto assets, including post-merger Ethereum, may become a “phenomenon” in the future, but not as long as their assets are yet to be “locked in”.
Speaking on a second quarter earnings conference call on August 9, Chief Financial Officer (CFO) Alesia Haas indicated that she does not expect their new proprietary institutional staking service to , deployed in the second quarter, a "short-term phenomenon". until a "truly liquid staking option" becomes available.
"This is the first time we've had the products available. Previously, institutions could access staking through Coinbase Cloud [...] But offering it as a delegated staking service similar to what we have for retail customers.”
However, Haas said it was in the early stages of its new staking service, adding that it would likely only see a "real hardware impact" once it created a staking option. liquid for post-merger Ethereum, also known as ETH2.
Liquid staking is the process of locking up funds to earn staking rewards, while still having access to the funds.
Haas explained that many financial institutions "don't want their assets to be held indefinitely".
“So when you stake on ETH2, you lock your assets into Ethereum until the merger and then some time after. For some institutions, this blocking of liquidity is not suitable for them. And so, even though they may be interested in staking, they want to have staking on a liquid asset. »
Haas reaffirmed that this problem is "something we seek to address", and added that once this liquid participation is available to financial institutions that can pool funds in higher proportions, "we will see the real material impact of institutional income."
Related: Coinbase Partners with BlackRock to Create New Access Points for Institutional Crypto Investing
Investors and...
Coinbase's new institutional staking product will not be a "short-term phenomenon" while liquid staking is still in progress elaboration.
New
Institutional staking of crypto assets, including post-merger Ethereum, may become a “phenomenon” in the future, but not as long as their assets are yet to be “locked in”.
Speaking on a second quarter earnings conference call on August 9, Chief Financial Officer (CFO) Alesia Haas indicated that she does not expect their new proprietary institutional staking service to , deployed in the second quarter, a "short-term phenomenon". until a "truly liquid staking option" becomes available.
"This is the first time we've had the products available. Previously, institutions could access staking through Coinbase Cloud [...] But offering it as a delegated staking service similar to what we have for retail customers.”
However, Haas said it was in the early stages of its new staking service, adding that it would likely only see a "real hardware impact" once it created a staking option. liquid for post-merger Ethereum, also known as ETH2.
Liquid staking is the process of locking up funds to earn staking rewards, while still having access to the funds.
Haas explained that many financial institutions "don't want their assets to be held indefinitely".
“So when you stake on ETH2, you lock your assets into Ethereum until the merger and then some time after. For some institutions, this blocking of liquidity is not suitable for them. And so, even though they may be interested in staking, they want to have staking on a liquid asset. »
Haas reaffirmed that this problem is "something we seek to address", and added that once this liquid participation is available to financial institutions that can pool funds in higher proportions, "we will see the real material impact of institutional income."
Related: Coinbase Partners with BlackRock to Create New Access Points for Institutional Crypto Investing
Investors and...
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