BitGo Bank & Trust has begun offering Bitcoin staking through the Stacks network to a limited set of institutional clients, giving them a way to earn BTC-denominated rewards on coins that never leave the trust bank's qualified custody.
The company said in a post on X on Tuesday that eligible qualified custody clients can now earn BTC rewards on bitcoin held at BitGo Bank & Trust through Bitcoin Staking with Stacks (STX). Access is restricted for now to whitelisted institutional partners managed by Stacks Labs, the entity that stewards the Stacks ecosystem.
How the arrangement works
Stacks is a layer built atop Bitcoin that supports smart contracts and decentralized applications while settling transactions on the Bitcoin base chain. Its staking mechanism, known as Stacking, involves locking STX tokens and earning rewards paid in bitcoin.
Under BitGo's structure, staked bitcoin remains on the Bitcoin network and is timelocked for the duration of each bond, which runs roughly six months. According to Stacks Labs, the coins are not lent, bridged or wrapped. Principal is returned at maturity, and the protocol carries no slashing mechanism.
Each position must be paired with STX worth 5% of the staked bitcoin's value. Rewards originate from Stacks miners, who spend BTC on the Bitcoin network to mine Stacks blocks. A target rate is set before each bonding period opens, though the realized rate can differ depending on when miners distribute rewards, Stacks Labs said in a blog post.
BitGo handles reward claims on behalf of clients. Clients can also direct staking rewards to an address separate from the one used to stake, a feature the company said can help issuers of exchange-traded products and funds keep principal and rewards apart.
The bitcoin is held under a timelock using standard Bitcoin script, which BitGo said is compatible with coins held at a qualified custodian.
Note: Details as disclosed by BitGo and Stacks Labs.
Risk disclosures and open questions
BitGo flagged that the accompanying STX position carries its own market price exposure. It also cited smart contract and protocol risk, along with restricted access to the bitcoin during the bond period, which the company said could result in delay or loss. Rewards are variable and not guaranteed.
The disclosure leaves several operational questions unanswered. BitGo has not publicly detailed the full eligibility criteria, the rollout timeline, minimum capital thresholds or the fee and reward structure. Those terms will determine whether the offering remains a narrow pilot or becomes a broadly used feature for large allocators.
Background
The launch extends a relationship that dates back to 2021, when BitGo first integrated Stacks. In August, the company added institutional custody and minting of sBTC, a Bitcoin-backed asset on the Stacks network.
It also builds on a broader expansion of BitGo's institutional franchise. In late August the firm completed its acquisition of NYDIG's institutional trading business, and last month Kalshi tapped BitGo for crypto-backed margin loans. BitGo has separately worked with DTCC on infrastructure for tokenized Treasuries and equities.
Bitcoin has long lacked the native yield that proof-of-stake networks such as Ethereum provide, and institutional holders have generally treated it as a store of value rather than a productive asset. Stacks offers a route to BTC-denominated rewards while keeping exposure to Bitcoin's base-chain security model, a proposition that has drawn more commercial interest as allocators look to put digital asset holdings to work.
What it means for the market
For custody providers, the offering tests whether institutions will accept a six-month lockup and a mandatory STX leg in exchange for bitcoin yield. The 5% STX pairing means clients take on a second asset's price risk, a structure that could limit uptake among conservative allocators even as demand for Bitcoin-linked yield products grows.
Regulated market infrastructure has been moving in the same direction. DTCC's listing of 21Shares Polkadot staking ETF shares under the TDOT ticker is one signal that traditional plumbing is increasingly equipped to handle staking-related products.
The immediate read-through for STX is a modest expansion of institutional demand channels, though the whitelist constraint caps near-term flows. For BitGo, the launch adds a yield product to a custody franchise that competes on compliance depth rather than product breadth. Whether it moves meaningful volume depends on terms the company has yet to publish.
