Cayman-based crypto lender Ledn secures some of its staking accounts

Cayman-based crypto lender Ledn secures some of its staking accounts

Ledn out of its lending operations, Ledn has segregated a portion of its staking accounts.

Ledn, a Cayman-based crypto lender, will launch accounts offering exposure to Ethereum staking on Oct. 12th.

With Ledn's growth account, customers can stake through it by transferring ETH to its growth account product, with the platform offering annual percentage yields of up to 2%. The delays associated with manual staking or unstaking Ether are not imposed on growth accounts.

Ledn has also launched growth accounts for Tether, the leading stablecoin by market cap, offering APYs of up to 8.5%. The new devices are not available to Canadians or the United States at launch, but will be available to consumers of the United States and Canada at launch. Ledn has already offered growth accounts for BTC and USDC.

The ring-fencing feature on growth accounts enables clients to shield them from the risks associated with other company offerings. Ledn hopes the system will overcome the widespread skepticism of centralized platforms held by many web3 users following failures of large CeFi amid last year's market downturn.

''Sing-fencing' ensures that clients are only exposed to the counterparties that generate their yield, and their assets will not be affected, even in the unlikely event of Ledn's bankruptcy,' the company said in a statement.

While centralized players like Ledn are looking to streamline the onboarding process for users seeking exposure to staking yields, Ethereum developers recently agreed to introduce measures to slow the rate new stakers can come online as part of Ethereum's next upgrade.

More than 21.5% of circulating Ether has been locked up for staking in 12 months following Ethereum's transition to Proof of Stake, according to Staking Rewards. A recent paper published by prominent researchers Tim Beiko and Dapplion estimates that 50% of Ether's supply could be staked within 12 months.

Dapplion said 'the security of Ethereum' could be at stake if too much of the ETH supply is locked up for staking. The excessive dominance of Ethereum's staking layer could be harmful to Ethereum's on-line liquidity, or affect its ability to pay for transaction fees.