Renowned crypto custodian, BitGo made an announcement on Thursday that it was adding staking to its services and will start with Dash and Algorand. The service which will be known as BitGo Staking is set to see coin holders earn between 7 to 13 percent annual returns.
In a press statement, BitGo stated that while it is starting with support for only two cryptocurrencies, plans are underway to add extra cryptos to the BitGo Staking service.
BitGo also revealed that it had acquired blockchain startup firm, Hedge. BitGo will use Hedge staking infrastructure and will allow clients to either delegate the staking to BitGo or to other staking providers.
According BitGo’s CTO, Ben Chan, clients will have the power to use their assets while in custody and staking will help them to earn on their investments without the need of moving the assets from the custody. Chan also added that the acquisition of Hedge will help in addition of staking experts within BitGo’s engineering platform and enhance the delivery of superb staking services.
On his part, the CEO of Dash Core Group, Ryan Taylor, praised the new developments saying that enhancing trust in cryptos is a shared mission and is the motivation behind the new partnership between the two firms.
Sean Ford, COO of Algorand, expressed his excitement stating that through the provision of custodial services with multi-sig security and now the staking services, the partnership with BitGo will avail more opportunities for Algorand community.
The consensus mechanism was first introduced by Ethereum co-founder Vitalik Buterin whereby Proof-of-Stake (POS) gifts token holders with different percent yields of a coin and is dependent on the time and the amount held. One of the key benefits of POS over POW is that it requires less mining power making it more energy efficient. Ethereum is touted to transition to this model before the end of 2020.
Since its inception, various custodians have been adding staking services. For instance, Coinbase introduced its staking services in March this year awarding returns of about 6.6 percent annually.