Coinbase Custody is a new platform service launched by Coinbase, aimed at providing secure storage of digital assets for institutional investors. This service is important in that it opens a secure gateway for institutional investors and hedge funds to enter and operate in the cryptocurrency space.
Coinbase Custody is intended to provide institutions with a secure means to buy, store and, more recently, wager digital assets such as cryptocurrencies, with access to audit trails, withdrawal limits and multi-signatory support.
WHAT IS COINBASE STAKING?
One of Coinbase Custody’s offerings is staking services to institutional clients, starting with Tezos. Staking in the Tezos ecosystem is called baking and Coinbase’s 60 institutional clients will have the opportunity to use this service from the end of March 2019.
Tezos is one of the top betting coins: here is the full list of other cryptocurrencies you can bet on.
This is the first full service of its kind: regulated, comprehensively secured and 100% offline cryptocurrency betting provider. In the coming weeks, Coinbase Custody will add governance support for the Maker (MKR) protocol.
Given that gambling requires some funds to be online all the time, making it a honey pot for potential hacking attacks, it is very important to note that customers’ assets will remain within Coinbase’s fully secured cold storage at all times, mitigating risk for investors as Coinbase will be putting its own coins, taking the risk.
Tezos is a new blockchain, another “Ethereum killer” that was first proposed in a paper published in August 2014 with more details announced in a whitepaper published in September 2014. The Tezos blockchain is designed with a focus on on-chain governance, allowing token holders to vote on proposed changes to functionality to avoid forking the network.
⚡️ The Tezos blockchain uses a modified version of a delegated Proof-of-Stake (DPoS) system where stakers, called bakers within the network, can block their tokens in exchange for the ability to validate blocks. In Tezos, more liquid users of the DPoS system can “delegate” tokens to bakers without transferring ownership. Rewards for validating blocks are distributed to bakers in the form of new XTZ tokens with a proportional amount of the reward distributed to wallets that have delegated tokens to the baker. This allows smaller token holders to participate in the validation (and reward) process if they have less than the amount required to become full bakers.
Coinbase will, of course, charge fees for its services, but customers can still expect a solid return of approximately 6.6% on the XTZ stake.
WHAT OTHER COINS WILL COINBASE WAGER ON?
Officially, they only support Tezos and will also add support for Maker, soon. As for other bitcoins like ADA, NEO, soon also Ethereum, there is no official position or announcement from Coinbase about their inclusion on the platform. However, given that Coinbase Custody is another source of revenue for Coinbase, it is reasonable to expect that they will include all other major bitcoins in their offering.