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Lido, the dominant player in the liquid staking market, is doubling down on its institutional clientele with the launch of Lido Institutional. The new service aims to address the specific needs of large-scale investors like crypto funds and asset managers seeking to stake their Ethereum (ETH).
While institutions can technically stake ETH independently, Lido’s offering is designed to streamline the process and alleviate regulatory concerns. By providing a dedicated platform for institutional clients, Lido is ensuring that their staked ETH (stETH) remains distinct from that of retail investors, mitigating anti-money laundering (AML) and know-your-customer (KYC) complexities.
Lido currently commands a substantial portion of the liquid staking market, holding 28.75% of all staked ETH. This new initiative is part of the platform’s broader strategy to expand stETH adoption by fostering a robust ecosystem of custodians, MPC wallets, and technology partners. Collaborations with firms like Fireblocks and Deribit are central to this effort, enabling seamless integration with existing institutional workflows.
Kean Gilbert, Lido’s Institutional Relations Lead, emphasized the company’s focus on institutional growth, highlighting the goal of doubling its institutional client base. Lido Institutional is positioned to capitalize on the growing demand for ETH staking solutions, particularly in light of the recent surge in ether ETFs that lack staking capabilities. By offering a way for institutions to capture the full yield of Ethereum Beacon Chain rewards, Lido is presenting a compelling alternative to traditional ETF investments.
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The platform’s decentralized nature, characterized by a diverse operator set, differentiates it from competitors. However, Lido Institutional also provides the level of support and service that institutional investors expect, addressing a critical pain point for large-scale clients. As Gilbert pointed out, industry giants like BlackRock and Fidelity demand a higher level of service than what is typically offered in the decentralized finance (DeFi) space.
Lido’s foray into the institutional market signifies a maturing DeFi landscape, where traditional financial services are increasingly intersecting with the world of cryptocurrencies. By catering to the specific needs of institutional investors, Lido is positioning itself as a leader in the evolving digital asset ecosystem.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
I’m your translator between the financial Old World and the new frontier of crypto. After a career demystifying economics and markets, I enjoy elucidating crypto – from investment risks to earth-shaking potential. Let’s explore!
