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Cryptocurrency custodian BitGo has announced the launch of its staking service with initial support for Dash and Algorand.
The company said that the foundation of BitGo Staking is its recent acquisition of Hedge, a provider of scalable, programmatic deployment of staking infrastructure.
In a press release, BitGo said that it has integrated Hedge’s automated secure deployments, scalable and redundant processes, and the use of hardware security modules (HSMs) and secure cryptographic enclaves.
With the launch of the staking service, clients will be able to generate passive income with their assets held with qualified custodian BitGo Trust. Clients can choose to delegate staking to BitGo or to the provider of their choice.
BitGo Staking will initially support Dash and Algorand with plans to launch support for additional coins later this year. The rate of return will vary by coin, ranging from 7 percent to 13 percent.
“In order to be a great custodian, we need to provide our clients with the ability to use their assets in custody. Staking provides our clients with returns on their investments without ever moving their assets out of custody,” said Ben Chan, CTO, BitGo. “Our acquisition of Hedge builds on the blockchain and staking expertise within our engineering platform to deliver an automated, end-to-end staking service.”
Proof of Stake (PoS) is a consensus mechanism which is said to be more energy-efficient than Proof of Work (PoW). It involves rewarding token holders with percent yields of a coin based on the length and amount held, CoinDesk reported.
Earlier this year, Coinbase Custody launched staking services for institutional investors, starting with Tezos. More recently, Binance has announced the launch of its official staking platform, which is available to its users as a value-added service.
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