BitGo is offering Bitcoin staking through Stacks to eligible institutional clients of BitGo Bank & Trust, allowing them to earn BTC rewards while keeping their Bitcoin in qualified custody, Stacks Labs said in a Nov. 3 announcement.
The integration lets clients participate from existing BitGo accounts without moving their Bitcoin to another provider, lending it out or converting it into a token on another network, according to Stacks. The BTC stays on Bitcoin’s base layer under a timelock for the bond’s roughly six-month term.
Each position must be paired with STX, Stacks’ token, worth 5% of the committed BTC’s value. That STX allocation secures the position’s claim on rewards. Stacks’ institutional documentation says the paired STX is also locked for the bonding period, exposing participants to changes in its price.
https://x.com/i/status/2117647454002954485
The offering extends a relationship that already includes custody and conversion services for sBTC, a Bitcoin-backed token on Stacks. BitGo described those capabilities in its earlier sBTC announcement. The new integration instead gives eligible clients a way to earn rewards on BTC that remains on Bitcoin.
Miner-Funded Rewards, Not Lending Income
The yield comes from BTC that Stacks miners spend competing to produce blocks and earn STX rewards and transaction fees. Stacks says the institutional staking program distributes BTC rewards weekly, giving paired Bitcoin positions priority over STX-only participants.
Each bond’s target rate is set before the period opens and applies throughout its term. The BitGo announcement does not specify a numerical rate, fee schedule or minimum investment. “Realized returns can vary with fees and miner reward timing,” Stacks wrote in its accompanying X thread.
Stacks says the protocol does not impose slashing, meaning it does not confiscate principal as a penalty. Its ratified protocol specification provides for recovery of BTC when the timelock expires. The protocol also allows an early exit with a designated signer group’s cooperation, but that forfeits remaining undistributed yield and leaves the paired STX locked until term end.
The arrangement retains BitGo as custodian. BitGo’s disclosures say digital assets held in custody are not guaranteed by the company and are not covered by FDIC or SIPC protections.
Institutions can register for upcoming bonding periods through Stacks. Its access process requires entity review and approval of BTC and STX addresses by the Stacks Endowment, which allocates limited capacity during the program’s bootstrap phase.