Germany's Boerse Stuttgart Digital, the crypto arm of the Stuttgart Stock Exchange, is taking another big step into the future of digital assets. They're setting up a fully insured cryptocurrency staking service set for a 2024 release.

Risk Mitigation Through Insurance

To mitigate the risks associated with slashing, a term describing the penalizing of validators in a proof-of-stake blockchain, the global reinsurance company Munich Re has developed a special insurance product. This insurance aims to safeguard staked tokens from being suspended or lost due to rule violations or malicious activities.

Traditional Finance Firms Get More Crypto-Savvy

This move is the latest in a series of traditional finance heavyweights diving into the digital asset industry. Earlier this week, Deutsche Bank was reported to be working with Taurus on digital asset custody and tokenization. HSBC is also teaming up with crypto custody firm Fireblocks. Stateside, Franklin Templeton is vying for the listing of the first spot Bitcoin ETF.

Regulatory Approval Secured

Boerse Stuttgart Digital has already obtained a license from Germany's finance watchdog BaFin, via its subsidiary Blocknox GmbH, to custody digital assets.

More Than Just Custody

The new staking service will enable Boerse Stuttgart Digital and its clients to earn rewards on assets stored with the firm. Dr. Oliver Vins, the managing director of Boerse Stuttgart Digital, expressed, “We have noticed an increasing interest from institutional investors in the staking sector. They are keen to participate as long as they can trust the security of the environment.”

Wrapping Up

This venture is a vivid sign of how rapidly the boundaries between traditional investment services and the growing digital asset space are blurring. Stay tuned for further developments as Boerse Stuttgart Digital preps for its 2024 fully insured crypto staking service release.