Anchorage Digital Announces Institutional Ethereum Staking
Table of contents
"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,"
Anchorage Digital Plans to Secure Their Funds
Anchorage Digital plans to hold institutional clients' cryptocurrency in cold storage to secure their funds. It includes banks, venture capital firms, and even governments. In contrast to hot storage, which occurs when a digital asset is kept on an online wallet, this is when it keeps offline.
Staking is the consensus technique used by Proof-of-Stake (PoS) blockchains. This is when users of blockchains lock up cryptocurrency in exchange for the blockchain's native coin, which is used to validate transactions. PoS is distinct from the Proof-of-Work (PoW) consensus mechanism that Bitcoin utilizes, which requires a lot of energy-intensive computation to create new blocks.
Awaited Ethereum Merge
The second-largest blockchain is getting close to its long-awaited "Merge," in which it will finally complete the transition from PoW to PoS, and Anchorage has just launched Ethereum staking. Ethereum is currently in the process of gradually turning into a PoS blockchain. Anchorage Digital, headquartered in San Francisco, received a federal bank charter in 2021. The Office of the Comptroller of the Currency (OCC), a division of the Treasury Department that aids in the regulation of national banks, took the initiative to become the first institution in the United States to grant a federal bank charter to a digital asset bank.