Alesia Haas, the Chief Financial Officer of Coinbase, has aired her opinion on institutional crypto staking saying, staking crypto assets at the institutional level could be the next big thing in the crypto space, especially in the post-merge era of Ethereum, but sadly, it will not happen while assets still need to be locked up.
Haas, speaking at the crypto exchange’s second-quarter earnings call on Tuesday, noted that the new exclusive product targeted at institutional staking rolled out by the exchange in the second quarter of the year is not expected to do so well in the short term until there is an option for liquid staking in the space.
She said: that the quarter is the first time the service was rolled out. Before then, institutions could participate in crypto staking through the Coinbase Cloud services, however, the service is offered as a delegated staking service which is the same thing as what the exchange is offering the retail users.
Liquid Staking Option and Post-Merge Ethereum Upgrade
In the call, she added that the new staking service is still in its early days, and the real impact could only be measured when the post-merge Ethereum upgrade comes with the liquid staking option.
Contrary to losing access to your assets while staking, liquid staking allows you to stake your crypto assets while you still retain access to the funds.
The Coinbase CFO explained that many institutions are interested in crypto staking, but the idea of losing access to their assets during the staking period does not go well with them.
She reaffirmed that there is nothing unsolvable about the problem, and as a matter of fact, the company is looking to solve the problem. She added that once the liquid staking option is rolled out, financial institutions are ready to stake their funds in large proportions, and it is until then that the real impact of institutional revenue can be felt.
Currently, institutions and investors have been able to access the delegated staking service provided by Coinbase via Coinbase Prime, which was rolled out in September 2021. On the platform, users can also gain benefit from other integrated services like crypto market data and analytics in real-time, and access to a custody wallet with enhanced security, among other features native to the crypto space like decentralized governance.