BridgeTower Capital, which operates more than 8,000 validator nodes running on 100% renewable energy, is deepening its roots in the crypto ecosystem through its focus on regulatory compliance.
On Wednesday, BridgeTower Capital announced its turnkey on-ramp that connects financial institutions to Lido’s staking infrastructure and a security token that allows institutional investors to participate in layer 1 blockchain Avalanche’s staking rewards.
Through BridgeTower’s regulated marketplace, institutional investors can complete their know-your-customer (KYC) process, have a delegated, whitelisted wallet, stake their ether (ETH) straight into Lido’s system. BridgeTower’s integration with Lido’s ecosystem is fully automated and allows investors to take advantage of Lido’s staking infrastructure in ways that are consistent with regulatory standards.
The blockchain technology firm is also offering a security token, a new product that allows purchasers to receive rewards associated with Avalanche’s staked AVAX token. By collaborating with Securitize, a regulatory-compliant platform for issuing digital asset securities, BridgeTower is offering a security token that represents staked AVAX and sits on a regulated exchange.
When an institutional investor purchases a security token, BridgeTower delegates a wallet that receives Avalanche’s staking rewards to the institutional investor. “This is a way to get full access to a staked token through a security,” said Cory Pugh, CEO of BridgeTower Capital, in an interview with CoinDesk.
According to BridgeTower’s press release, “Rewards will be custodied on behalf of investors and, upon completion of the lock-up period, will be distributed to an investor wallet created by Circle.” Moreover, BridgeTower will use Chainlink’s Proof of Reserve service to monitor and verify the balance of an investor’s wallet and relay that information to their investment dashboard as on-chain proof.
To work through the Securities and Exchange Commission and ensure BridgeTower’s products met all regulations, BridgeTower’s legal department included their own in-house attorney, Securitize’s attorneys and an outside legal firm, according to Pugh.
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