Thomas Daniels
Despite Ether’s (ETH) sluggish performance relative to Bitcoin and other digital assets in 2025, institutional appetite for Ethereum staking continues to strengthen. According to Kean Gilbert, Head of Institutional Relations at the Lido Ecosystem Foundation, this surge in interest is driving demand for advanced custody solutions that enable a broader array of institutional investors to participate in Ethereum’s staking economy.
On May 27, Komainu, a regulated digital asset custodian, announced support for custody of Lido Staked Ether (stETH), Ethereum’s largest staking derivative, which currently represents 27% of all staked ETH. At press time, ETH traded at $2,660, while stETH maintained a nearly equivalent value of $2,659.97.
Komainu’s custody offering is now accessible to institutional clients in Dubai, United Arab Emirates, and Jersey, a self-governing dependency of the British Crown. This development offers a compliant on-ramp for institutional players seeking exposure to Ethereum staking yields while adhering to regulatory frameworks.
“Many asset managers, custodians, family offices, and crypto-native investment firms are actively exploring staking strategies,” Gilbert noted in an interview with Cointelegraph.
As U.S. ETF issuers await regulatory clarity surrounding Ethereum staking ETFs, liquid staking tokens such as stETH are providing an interim solution. “Institutions find liquid staking tokens like stETH useful because they directly address challenges related to capital lock-ups and complex custody arrangements,” Gilbert explained.
Staked ETH derivatives such as stETH offer immediate liquidity, making them particularly attractive to institutions concerned with asset accessibility and compliance. Qualified custodians including Komainu, Fireblocks, and Copper have enabled secure, regulated storage for these staking tokens, addressing one of the primary barriers that previously limited institutional participation.
Lido’s recent rollout of Lido v3, featuring modular smart contracts tailored to institutional compliance needs, has further accelerated adoption. “Historically, the limited availability of regulated custodians or MPC wallet providers supporting stETH was a significant barrier for these institutions,” Gilbert added.
In contrast, crypto-native firms generally operate with higher risk tolerance and manage their digital asset custody in-house, often bypassing third-party custodians entirely.
Both traditional and crypto-native financial institutions increasingly utilize stETH to access Ethereum staking rewards without the drawbacks of capital illiquidity. Moreover, stETH offers versatility across decentralized finance (DeFi), centralized finance (CeFi), and over-the-counter (OTC) markets, further enhancing its appeal.
