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Ruholamin Haqshanas
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Ruholamin Haqshanas
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Cryptocurrency custody provider BitGo has introduced institutional-grade Bitcoin staking through a partnership with Core DAO, a layer-1 blockchain platform.
According to a joint announcement on December 9, BitGo will be one of the first custodians to facilitate institutional access to dual staking with Core DAO. It will allow clients to earn returns on their Bitcoin holdings.
The staking mechanism enables institutions to maintain full custody of their assets, mitigating counterparty risks often associated with traditional staking methods.
What Is Bitcoin Staking?
Bitcoin staking, distinct from the traditional proof-of-stake (PoS) mechanism, involves new approaches to generate yield.
While Bitcoin’s proof-of-work (PoW) consensus mechanism inherently does not support native staking, there are alternative methods, including custodial lending, wrapping BTC for decentralized finance (DeFi) purposes, layer-2 staking, and restaking.
Restaking, a technique highlighted by Core DAO, involves locking Bitcoin with an intermediary protocol, which then stakes it with external client chains to earn rewards.
Core DAO’s non-custodial staking model allows users to lock their Bitcoin on the blockchain to enhance the security of the Core blockchain.
In return, participants earn Core (CORE) tokens. Furthermore, Core DAO’s dual staking model rewards users with higher Bitcoin staking rates when they also stake CORE tokens.
“BitGo’s integration with Core underscores our commitment to expanding opportunities for institutional clients to securely generate yield from their Bitcoin holdings,” said Mike Belshe, CEO of BitGo.
Courtesy of this integration, BitGo will now offer institutional clients the ability to secure enhanced staking rewards.
The service allows institutions to time-lock their Bitcoin and stake CORE tokens directly via BitGo’s custody platform.
Lava Aims to Offer Bitcoin-Backed Dollar Loans
BitGo’s new service comes as Lava, a New York-based Bitcoin lending platform, has secured $10 million in Series A funding from major VC firms Khosla Ventures and Founders Fund to enable users to borrow dollars against their Bitcoin holdings.
This aims to address a common challenge for crypto investors who want to leverage their assets without liquidating them.
Crypto lending has faced significant scrutiny following the 2022 collapses of firms like Genesis, BlockFi, and Celsius. These failures, driven by practices such as rehypothecation—where client collateral is used to back other transactions—damaged trust in the sector.
Lava aims to rebuild confidence by allowing users to self-custody their assets, ensuring the platform never takes direct control of Bitcoin holdings.
Rabois praised this feature as a “technical breakthrough” aligned with Bitcoin’s ethos of decentralization and self-sovereignty.
