Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.
The Bitstamp Earn product will offer returns only on staking ETH and ALGO. Note that it won’t be involved with any kind of lending process.
Luxembourg-based cryptocurrency exchange Bitstamp is now looking to expand its presence in the US markets by introducing its Bitstamp Earn products to American investors. The Bitstamp Earn product introduces a staking offer for two cryptocurrencies Ethereum (ETH) and Algorand (ALGO).
Bitstamp Earn Product
Bitstamp is already offering this product to its non-US customers. To participate, users just need to fund their Bitstamp account and collect staking rewards. On the yield that the customers earn, Bitstamp will take a part as their fees. Apart from Ethereum (ETH) and Algorand (ALGO), Bitstamp plans to roll out support for other staking assets in the coming months.
Bobby Zagotta, CEO of Bitstamp’s US business, said that a number of Americans are considering delaying retirement due to record-high inflation. He also noted that more people have started to look beyond the traditional ecosystem.
However, Zaggotta clarified that the product won’t generate yields through lending, unlike other high-interest crypto accounts. Speaking to Decrypt, he further added:
“This offering is staking, pure and simple. We’re not into a lending product in the US and as such, you know, it’s a protocol-driven set of rewards. We don’t have discretion over how those rewards are created. We’re not moving people’s funds or making investments. So it’s very, very far removed from what some of the lending companies like BlockFi have done.”
Addressing Regulatory Challenges
Following the recent crypto market crash, regulators have gone tough on the crypto market players. Earlier this year, the US Securities and Exchange Commission (SEC) asked crypto firms like BlockFi and Celcius to stop offering high-interest accounts to US customers.
Although BitStamp is not taking the lending route, it still has some work to do with the regulators. At the launch, the Bitstamp Earn product will not be available to customers in Idaho, Alabama, Hawaii, New Jersey, Nevada, Louisiana, and New York.
But Zagotta is confident that Bitstamp’s product will have room to grow in the United States. “We’ve been in building mode. We’ve doubled our [US] staff and we have kind of relayed out the product roadmap,” Zagotta said. “And so there will be more announcements, both in the form of tokens available for listing in the US, but then also other Earn-like offerings that will enable people to do more with their assets.”