Ripple Expands Custody Services to Include Ethereum and Solana Staking for Institutions

Ripple has enhanced its institutional custody business by enabling staking services for Ethereum and Solana. This strategic move allows large investors to earn staking yields on these major proof-of-stake networks without the complexities of managing their own validator infrastructure. The new feature, developed in partnership with staking provider Figment, aims to provide institutional-grade controls and operational simplicity, catering to banks, custodians, and regulated asset managers.

Key Takeaways

• Ripple Custody now offers staking for Ethereum and Solana through a partnership with Figment.

• This service allows institutional clients to earn staking rewards without managing validator infrastructure.

• The move highlights a difference between XRP and proof-of-stake assets regarding native staking rewards.

• XRP Ledger (XRPL) staking is still under discussion with unresolved economic and distribution challenges.

• Despite the lack of native XRP staking, XRP-linked investment products continue to see strong inflows.

Institutional Demand for Staking Services

Ripple's expansion into Ethereum and Solana staking addresses a growing demand from institutional clients who view staking yield as a standard service alongside asset safekeeping. By partnering with Figment, Ripple provides a solution that separates duties, ensures operational assurance, and offers an auditable framework. This is crucial for regulated firms that prioritize compliance and auditability when seeking to generate yield from their digital assets.

Figment was chosen for its extensive experience with over 1,000 institutional clients, its non-custodial architecture, and its focus on regulated participants. This approach ensures that asset custody and validator operations remain distinct, providing clear lines of control and risk monitoring, which are essential for institutional due diligence.

The XRP Staking Landscape

The introduction of staking for Ethereum and Solana also underscores the current absence of native protocol-level staking rewards for XRP. While XRP investment products are attracting significant inflows, the XRP Ledger (XRPL) does not currently offer a built-in mechanism for earning yield. Discussions around XRPL staking are ongoing, but they face economic hurdles, including the need for a sustainable rewards source and a fair distribution mechanism. Unlike many proof-of-stake networks, XRPL's current model involves burning transaction fees rather than redistributing them, and validator trust is earned through performance.

Ripple's Institutional DeFi Roadmap

Ripple maintains that this expansion does not diminish XRP's importance in its strategy. Instead, the company's "Institutional DeFi" roadmap positions the XRPL as a high-performance blockchain for tokenized finance, equipped with compliance tools for regulated use cases. XRP is envisioned as a connective asset for reserve requirements, transaction fees, and auto-bridging in foreign exchange and lending. This multi-asset custody approach allows institutions to earn yield on Ethereum and Solana while leveraging XRPL for other on-chain activities, positioning XRP as infrastructure rather than solely an income-generating asset.

Sources

• Ripple introduces Ethereum and Solana staking, CryptoSlate.