The Stuttgart Stock Exchange’s cryptocurrency-focused section, Boerse Stuttgart Digital, has announced intentions to introduce a fully insured cryptocurrency staking service.
A division of the Boerse Stuttgart company, which describes itself as the sixth-largest stock exchange company in Europe, is Boerse Stuttgart Digital. The staking service will launch early in the next year.
Dr. Oliver Vins, the managing director of Boerse Stuttgart Digital, stated the following in a press statement on Tuesday:
“We have seen an increase in institutional investors’ interest in the staking industry, and they are keen to become involved as long as they are completely confident in the environment’s security.“
Some blockchains have a feature called staking that enables users to safeguard the network by locking away their tokens in exchange for recurring cryptocurrency payments.
Staking services like those offered by Boerse “eliminate obstacles” for institutional investors that don’t want to bear the technical cost or risk associated with the process, even though it is theoretically a decentralized activity that anybody may participate in. For this reason, co-founder and Ethereum engineer Vitalik Buterin has publicly highlighted his concerns regarding personal staking.
Insuring Institutions
The famous international reinsurance giant Munich Re is one of the primary participants in Boerse’s attempt. The company has developed a special insurance product to reduce the dangers of slicing in proof-of-stake blockchains.
Slashing is the term for the corrective action used to describe the suspension or loss of staked tokens for validators that break network policies or participate in malicious behavior.
Boerse Stuttgart Digital hopes to draw in a wider customer, particularly institutional investors who have demonstrated an increasing interest in the staking industry, by providing a fully insured staking service.
Through its subsidiary, Blocknox GmbH, Boerse Stuttgart Digital has already been granted permission by the German Federal Financial Supervisory Authority (BaFin) to offer custody services for digital assets.
This development comes in the wake of recent actions taken by other illustrious financial organizations, such Deutsche Bank and HSBC, who have been aggressively looking into partnerships and projects in the digital asset field.
In the past, crypto native players like Coinbase and Kraken have tried to offer staking services to institutional and individual investors residing in the United States. However, the Securities and Exchange Commission (SEC) has filed a lawsuit against each of them for failing to register their offers as securities products.
