Ledn to Launch Ethereum Staking Accounts Starting October 12

The Cayman Islands-based lending platform Ledn is set to launch Ethereum (ETH) staking accounts on October 12, 2023. This development comes in response to user requests for a simplified way to earn interest on their ETH holdings without engaging in manual staking and managing Ether through liquid staking pools.

Ledn’s Growth Accounts will support this initiative, complementing existing services that allow users to earn interest on Bitcoin (BTC) and USDC deposits. The company has assured that these accounts are “ring-fenced” from its other offerings, meaning that the deposited ETH will only be exposed to the counterparty responsible for generating yield from the staked amounts. This structure is designed to protect users’ deposits in the event of Ledn’s bankruptcy.

Mauricio Di Bartolomeo, Ledn’s chief strategy officer, shared that there has been substantial interest from users regarding an Ether offering. He noted that this option is far easier to set up than traditional ETH staking: “This yield option is significantly easier to set up than native ETH staking. Looking ahead, we’re planning to integrate ETH support across our entire suite of products in the coming months,” he stated.

In addition to the new ETH staking service, Ledn will also launch a second stablecoin Growth Account on the same date, allowing users to deposit and earn interest on USDT tokens. However, these services will not be available to users in the United States or Canada.

Ledn’s expansion into Ethereum aligns with a trend among Bitcoin-centric companies that are beginning to support other cryptocurrencies. For example, Casa, a platform initially focused on Bitcoin, introduced multi-signature ETH self-storage in June 2023.

Furthermore, in August 2023, Ledn formed a partnership with a real estate company in the Cayman Islands to enable cryptocurrency users to invest in property, aiming to facilitate eventual residency.

The introduction of these services occurs amid notable failures within the cryptocurrency lending sector, underscoring the risks tied to questionable lending practices. Ledn’s ring-fencing mechanism is intended to protect clients from the risks associated with its other services.

This announcement also coincides with recent decisions by Ethereum developers aimed at slowing the rate at which new stakers can join, as part of an upcoming upgrade. This measure addresses concerns regarding the potential negative impact of excessive staking on Ethereum’s on-chain liquidity and transaction fee availability.