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Building Liquid Staking for Institutional DeFi & Strategic Investment from Blockdaemon & boldstart ventures

  • 03.03.2022

The new solution is targeted at financial institutions and big tech companies with strict compliance requirements who nevertheless are seeking exposure to yields offered by staking Ethereum & utilizing staked capital in DeFi. A range of institutional customers have already expressed interest in using the product, which is set to launch at the end of 2Q 2022. The launch of testnet, and the first validators is set for this week. This will give prospective customers the chance to test out the features in a safe, early environment ahead of the mainnet launch.

The StakeWise development team believes that institutional involvement in staking & DeFi is the expected next phase of flows into Ethereum, and StakeWise can become a key player in this market. By providing an institutional-grade product, StakeWise will be able to stay on top of the trend and unlock considerable TVL for its DAO. Joining forces with Blockdaemon, the leading infrastructure provider for institutions, StakeWise will have immediate access to clients looking for compliant ways to participate in DeFi and earn yield securely. Both teams are very excited about this opportunity!

What will the new product look like?

The protocol will feature a permissioned staked ETH token, meaning only whitelisted (read: KYCd) addresses will be able to interact with it. The token representation of staked ETH is a prerequisite to opening customers access to permissioned DeFi protocols that offer lending/borrowing capabilities, call & put options writing, interest rate swaps, and other innovations that enhance the efficiency of staked capital.

The core technology for the new protocol will be provided by StakeWise, with Blockdaemon initially acting as the sole node operator. The protocol will be governed by its own set of stakeholders, outside of StakeWise governance processes. Still, the StakeWise DAO will retain the economic benefits of providing code for the new protocol since a significant share of the new product’s revenue will flow directly to the StakeWise DAO Treasury.

In the words of Konstantin Richter, CEO and founder of Blockdaemon, “Blockdaemon is thrilled to partner with StakeWise to create a KYC-based liquid staking solution for Institutional customers. By building an institutional-grade liquid staking product on the Ethereum network, we are opening avenues for clients with demanding compliance requirements to utilize staked capital for borrowing, lending, option writing, liquidity provision and much more.”

Strategic Investment by Blockdaemon & boldstart ventures

To facilitate a closer alignment of interests in the new venture with its strategic partners, StakeWise has received an investment into SWISE from Blockdaemon & boldstart. The transaction will not affect the community’s share of SWISE ownership in the protocol.

We are excited to have boldstart ventures take part in this strategic effort. In the words of Ed Sim, founder and managing partner at boldstart, “StakeWise continues to innovate and advance ways to earn yield and has the opportunity to extend their services for institutional clientele via their partnership with Blockdaemon. It’s a breakthrough opportunity, as the need for secure, compliant liquidity options grows with Ethereum and can lead to massive benefits for customers and the ecosystem overall.”

About Blockdaemon

Blockdaemon is the leading independent blockchain node infrastructure to stake, scale, and deploy nodes with institutional-grade security and monitoring. Supporting 50+ cutting edge blockchain networks in the cloud and on bare metal servers globally, Blockdaemon is used by exchanges, custodians, crypto platforms, financial institutions and developers to connect commercial stakeholders to blockchains. We power the blockchain economy by simplifying the process of deploying nodes and creating scalable enterprise blockchain solutions via APIs, high availability clusters, auto-decentralization and auto-healing of nodes. For more information, please visit https://blockdaemon.com/.

About boldstart ventures

boldstart ventures is a day one partner and true believer for developer first, crypto infra and SaaS founders. We collaborate with technical founders well before company creation, lead pre-product rounds at inception, and rally our network to help turn bold ideas into category-creating iconic companies. We’ve been in the trenches with Snyk, Blockdaemon, Kustomer, BigID, Superhuman (and so many more) from day one. See more about us and our full portfolio @ www.boldstart.vc and @boldstartvc

About StakeWise

StakeWise is a liquid staking protocol on Ethereum enabling any Ether holder to earn a passive yield by staking without capital lock-up. All deposited & earned Ether is tokenized with StakeWise tokens in a 1:1 ratio, allowing users to exit from staking at any time, earn extra yield on their stake in DeFi, and flexibly manage their staking rewards. Launched in March 2021, StakeWise has accumulated over 50,000 ETH in deposits from retail customers to date and attracted over $100 million of liquidity for its staked assets. The protocol is backed by Blockdaemon, Boldstart, Collider Ventures, Greenfield One, Gumi Cryptos and Lionschain Capital.

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