The post The Top Five Digital Asset Staking Pillars Institutions Can’t Ignore appeared on BitcoinEthereumNews.com.

Digital Asset staking has a problem. Major institutional players increasingly want to participate, but most of today’s staking providers aren’t regulatory or enterprise-friendly. The status quo is infrastructure pieced together by small, sometimes inexperienced teams on centralized Big Tech clouds that are not tuned for digital assets – nor engineered to meet the regulatory compliance standards that major players like BlackRock demand. The traditional financial world has long-established standards for robust risk management strategies crucial to fulfilling institutional needs, and their service providers in the decentralized financial world must meet these requirements. And this is only the beginning. There are several essentials that every institution must consider when evaluating staking options. This guide covers the top five, including: Multi-Stake: diversification of providers, hardware & approach Security of people, processes & technology Service & reporting Custodial integrations & relationships Regulatory compliance, especially with audited practices like SOC 2 or ISO27001 – and CCSS We’ll first explore why diversification is the foundation of a resilient staking strategy and how the remaining pillars build on it. Following the spectacular collapse of FTX, institutions and sophisticated holders alike took a step back to revisit their custody practices. A paramount consideration was the shift to custodian diversification. As highlighted by Boston Consulting Group, diversification minimizes the impact of a single point of failure across market, counterparty, regulatory, and security risks.1 With innovation thriving and new providers continuing to emerge, the institutional staking industry sector has adopted a diversification theme, focusing on similar risk mitigation considerations.  It extends beyond service providers – a diversity of core infrastructure, hardware, networks, ownership, and staking approaches is also essential. As with telecom and data networks in the early 2000s, reliance on “diverse” providers that ride on the same physical layer undermines true diversity. Reliance on “diverse” providers that ride…

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Filed under: News - @ January 14, 2025 1:20 pm