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As digital asset staking continues to play an integral role in the digital asset landscape to help institutions earn rewards, Kiln has emerged as a leader in providing secure and scalable staking solutions. Recently, Rakkar has also partnered Kiln to integrate Kiln’s staking solutions into the Rakkar Custody platform, allowing institutions to stake and earn rewards seamlessly directly from Rakkar’s custodial wallets without compromising security.
In this interview, Laszlo Szabo, Co-Founder and CEO of Kiln, shares insights into the partnership, the benefits of staking for institutional clients, and what this collaboration means for the future of staking in the APAC region.
1. What role do you foresee staking to partake in the larger digital asset ecosystem in the next 5-10 years and how do you see digital asset institutions playing a part?
Laszlo: Staking is fundamental to Web3 infrastructure, serving as the core security mechanism for most blockchains. By staking assets, users earn the right to participate in the network and receive rewards in return. In the coming years, staking will remain crucial as a base layer of the digital asset ecosystem. Digital asset institutions will help democratize staking by creating user-friendly interfaces and collaborating with infrastructure partners like Kiln to ensure a safe and accessible staking experience for a wider audience. According to Messari, "It can be argued that staking is the closest thing we can get to a blockchain network’s “risk-free rate”. At some point, all institutions and entities interacting with digital assets will likely engage in staking.
2. How does Kiln’s integration with Rakkar’s custody platform benefit institutional clients, particularly in the APAC region?
Laszlo: This integration leverages the expertise of Rakkar Digital and Kiln in digital asset custody and enterprise-grade staking, offering an ideal solution for securing and growing a diverse range of digital assets.
Both companies uphold high-security standards, including SOC 2 Type II certification. At Kiln, we’re witnessing a rising interest in staking across the APAC region, one of our fastest-growing markets. Earlier this year, we established an office there to support this expansion, which has proven effective.
This growth highlights the region’s leadership in the global crypto market, particularly in countries like Hong Kong, Singapore, and Japan, where regulatory clarity has nurtured robust crypto ecosystems. It's undeniable that events like Token2049 and Solana Breakpoint in September were among the year's best, attracting significant attendance.
3. With the challenging regulatory landscape in regard to staking, how do you envision Kiln to transcend above all to drive adoption within the institutional space?
Laszlo: Given the uncertain regulatory landscape surrounding staking, Kiln positions it as a technological infrastructure activity rather than a financial service. We take a proactive approach, engaging with regulators and policymakers to enhance education in the space and promote proportionate and appropriate regulation. To support this effort, we’ve just released our staking white paper, available for download here.
To drive adoption in the institutional space, we believe that clearer regulatory frameworks are essential, along with top-tier security standards and effective reporting tools. Institutions need a clear view of their positions to manage performance, risk, and accounting efficiently—goals we aim to achieve with our various APIs.
On the security front, Kiln has never experienced a slashing event on Ethereum. Our proactive risk management practices, including anti-slashing measures and large-scale monitoring, have been recognized by the Ethereum Foundation. We are committed to complying with all applicable laws and regulations in the jurisdictions where we operate, maintaining a rigorous control framework focused on sanctions, anti-money laundering, consumer protection, and security standards.
4. As a veteran in the ever-changing institutional staking space, how do you envision the evolution of the role of a qualified custodian such as Rakkar?
Laszlo: We see qualified custodians like Rakkar becoming essential. They will not only provide secure storage but also robust staking infrastructure and technology for real-time monitoring and reporting, ensuring transparency through partnerships with staking providers like us. Additionally, custodians will continue to play a key role in educating clients about best practices, fostering greater confidence and adoption in the market.
5. How does Kiln stay ahead of the curve when it comes to creating value for financial institutions, and what innovations can we expect from Kiln in the near future?
Laszlo: At Kiln, we’re building the world's leading on-chain platform for rewards, across protocols and ecosystems. We aim to be and remain at the forefront of trends and innovation in the digital economy.
One of those rising use cases are stablecoins. While about 70% of on-chain volume is in stablecoins, less than 5% of users earn rewards by holding them. Currently, earning rewards on stablecoins requires users to interact directly with DeFi lending protocols, which can be complicated, burdensome, and pose security risks. Alternatively, users can choose custodial or actively managed products, which may increase regulatory risk and associated fees. Our recently launched solution, Kiln DeFi addresses these challenges by offering an easy flow for wallets and custodians to seamlessly manage the complexities of engaging with DeFi lending protocols. We will keep investing in the DeFi space to drive further innovation.
Then of course, there is restaking. As the leading operator on Eigenlayer, we invest heavily in R&D within the restaking space. This commitment has led us to be part of the rise of restaking protocols like EigenLayer where we are part of top operators supporting over 15+ AVSs and Symbiotic on Ethereum, along with exciting projects on other chains such as Jito and Solayer on Solana. We expect restaking to expand across major chains and anticipate a similar trend in the Bitcoin ecosystem.
And lastly, we are very excited about the BTC staking and DeFi evolutions lately. Kiln supports various BTC staking projects like Babylon, Stacks, and Core DAO to name a few. We aim to partner further with custodians like Rakkar to ensure institutions can benefit from these innovations on Ethereum, Bitcoin and Solana securely. We also closely monitor how the space is evolving, particularly with Layer 1 fees transitioning to Layer 2 and rollups.
For more information about the partnership and the services offered, please visit Rakkar’s official website and Kiln’s official website.
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