Anchorage Digital Will Allow Ethereum Staking For Institutions

Time Stamp: June 29, 2022 7:52 AM
Source Node: 1544162

Anchorage Digital will allow Ethereum staking for institutions and they will be able to earn rewards linked to the second-biggest digital asset by market cap so let’s read more in our latest Ethereum news today.

Crypto storage company Anchorage Digital will allow Ethereum staking and earning rewards related to ETH as the co-founder and president Diogo Monica said:

“By paving the way for institutions to stake their Ethereum, we’re providing heightened legitimacy to market-tested assets—and in the process, eliminating any hot wallet risks for institutions looking to generate new earnings from crypto.”

The idea is that Anchorage digital will keep the funds safe for institutions like banks, venture capital companies, and governments by holding their crypto in cold storage which is when the digital asset is held offline as opposed to hot storage when it is on an online wallet. The Proof of stake blockchains uses a consensus mechansim called staking which is when blockchain users lock up crypto to help the blockchain validate transactions and earn the native cryptocurrency as a reward. PoS is different from the consensus mechanisms BTC uses as the PoW is an energy-intensive process where computers work hard to solve complex math equations and generate new blocks.

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Anchorage launching Ethereum staking comes as the second biggest blockchain near the long-awaited Merge where it will complete the move from PoW to PoS. Ethereum is right now in the process of becoming a PoS blockchain as it already obtained a federal bank charter in 2021. The move by the Office of the Comptroller of the Currency that regulates national banks,s was the first in the US that allowed a digital asset bank to get this kind of federal bank charter.

As recently reported, The US Office of the Comptroller of the Currency OCC issued an order against Anchorage digital as it aims to pursue cease and desist proceedings against crypto custody banks for violating certain anti-money laundering requirements. The OCC said it issued a consent order against Anchorage Digital based on its failure to adopt a compliance program and in accordance with the required Bank Secrecy Act or BSA and the governemnt bureau said that these actions placed Anchorage Digital in violation of the operating agreement with the OCC.

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