Bridging the Gap: Kiln's Role in Integrating Crypto and Digital Assets with Financial Institutions | The Financial Technologist

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Download your free copy of the latest Financial Technologist magazine here.Following th...

Download your free copy of the latest Financial Technologist magazine here.

Following the approval of several Bitcoin ETFs in the United States in January 2024, more assets are expected to be green-lit to trade in public indexes, such as Ethereum (ETH), the first “Proof-of-stake” cryptocurrency by market capitalisation.

Proof-of-Stake protocols use staking to create consensus, which consists of locking native tokens (ie ETH) into a validator to earn the right to secure a chain and earn staking rewards by proposing new blocks or attesting other validators’ blocks. This means PoS asset-based ETFs will have the unique characteristics of being reward-bearing.

Kiln is the leading enterprise- grade staking platform, enabling institutional customers to stake assets and to whitelabel staking functionality into their offering. Kiln runs validators on all major PoS blockchains, with over $4.4 billion of stake under management and over 4% of the Ethereum network, running on a multi-cloud, multi-region infrastructure.

The company growth in 2023 was outstanding, striking partnerships with Web3 industry leaders like Coinbase, Fireblocks, Ledger, and Consensys. While revenue quintupled, Kiln's headcount has more than tripled to reach 60+ employees in three regions (EMEA, US & APAC) with ambitious recruitment plans for 2024.

Breaking the barriers for institutional access to value creation in the digital assets ecosystem from DeFi to ETF/ETPs.

Kiln just closed a $17 million fundraise to pursue global expansion plans with a new headquarters in Singapore and doubling down on developing innovative products, specifically for financial institutions to democratise value creation in the digital asset ecosystem.

After building staking aggregators that enable any crypto business to seamlessly integrate a wide range of staking products within its existing offering, Kiln is set to power similar products for DeFi.

Stablecoins represent 70% of the on-chain volume, yet only 1% of its supply bears interest versus 50% for staking. As giants like Paypal and Visa have already entered the space, there is still a large market to capture generating rewards out of stablecoins.

In Q1 2024, Kiln will offer companies and crypto-natives a single API to seamlessly interact with DeFi applications from their existing platforms and perform operations such as swaps and depositing stablecoins into lending protocols such as Aave or Morpho to generate rewards from their assets.

Kiln also has plans for traditional financial institutions which have been entering the Web3 space but still lack the right tools to navigate this new space. While Bitcoin ETF/ETPs have been the hot topic of Q1 2024, the crypto community is now watching developments for a similar index for Ethereum.

While the perspective of an interest-bearing publicly traded fund is appealing, those products require solving operational and technical challenges, such as enabling redemption of customers' funds in less than 24 hours, which is not possible natively on Ethereum.

Kiln solves this problem with validators NFT (vNFT) that represent individual validators and their associated metadata, allowing the buying and selling of underlying staked ETH assets instantly through a dedicated marketplace populated with custodians and market-maker partners.

After becoming the first independent staking company in terms of staked volume in 2023, Kiln is set to raise the bar again in 2024, tapping into a new range of products from DeFi to Traditional Finance.

Download your free copy of the latest Financial Technologist magazine here.

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