OrBit Markets, the leading institutional liquidity provider in digital asset options and structured products, has launched an innovative product allowing stakers to swap their variable staking rewards into a guaranteed fixed rate. The product was first designed in response to a request from Ribbon Finance, who has been pioneering innovation in decentralized structured products.
As the Ethereum blockchain transitions from Proof-of-Work to Proof-of-Stake, staking has become increasingly popular as a simple way to earn passive yields on digital assets, but those yields vary continuously depending on the network usage and other factors, making it difficult for users to predict returns. While interest rate swaps are widely used in traditional finance, equivalent products have yet to become commonplace in digital assets.
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Leveraging its strong expertise in derivatives, OrBit now offers a new customized solution to enable stakers to convert these variable rewards into a fixed rate if they prefer to have certainty over the yield. OrBit has already executed a number of transactions linked to the Ethereum staking yield earnt in Lido, the most-used liquid staking protocol, and is further expanding its capabilities to other chains and protocols.
Commenting on the benefit of the product, Julian Koh, founder and CEO at Ribbon Finance, said “Ribbon strives to offer its users sustainable yield through decentralized finance products. With its ability to offer staking yield swaps, OrBit has delivered for us a critical building block for our new R-Earn stETH strategy. We look forward to continuing to partner with OrBit to develop more innovative products.”
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