Sygnum Bank, a global digital asset bank, has recently announced the addition of staked Solana (SOL) to its Lombard loan collateral portfolio. This move allows clients to leverage their SOL holdings for fiat liquidity while earning staking rewards simultaneously, creating a unique opportunity for dual-income potential from a single crypto asset.
With over 20 tokens already eligible as collateral for Lombard loans, Sygnum’s decision to include SOL aims to cater to the growing institutional interest in Solana. The bank ensures that there is no co-mingling of client assets by fully segregating client positions on-chain, providing a secure and transparent lending environment.
Benedikt Koedel, Head of Credit and Lending at Sygnum Bank, highlighted the importance of offering staked SOL as collateral to optimize yield and maintain liquidity for clients. The staking rewards generated cover the majority of the fees, making Lombard loans that pledge staked SOL as collateral cost-effective.
Clients can access the staking service through Sygnum’s custody and staking platforms, with options available via the user interface, API integration, or client relationship managers. This new staking option allows clients to earn rewards on their SOL holdings efficiently.
Notably, Sygnum’s Lombard loan collateral portfolio also includes major coins like BTC, ETH, POL, and XRP, with loan volumes doubling over the past 12 months due to increasing institutional demand for crypto-backed financing. The bank’s successful track record in crypto-backed lending, exemplified by a USD 50 million Bitcoin-backed syndicated loan to Ledn last August, further solidifies its position in the industry.
Thomas Brunner, Head of Custody and Staking at Sygnum Bank, emphasized Solana’s significant adoption as a leading Layer 1 blockchain and the natural evolution of adding SOL staking capabilities to the bank’s offering. With SOL currently trading at $170.28, marking a 5.6% decrease in the past 24 hours, the market’s downturn has not deterred the coin’s overall positive performance, with a 10% increase in a week and 29% in a month.
Sygnum, founded in 2017, is a regulated digital asset bank with licenses in multiple countries, including Switzerland, Singapore, Abu Dhabi, Luxembourg, and Liechtenstein. The recent achievement of unicorn status with a valuation exceeding $1 billion following a $58 million funding round underscores the bank’s growing prominence in the digital asset space.
In conclusion, the addition of staked SOL as collateral by Sygnum Bank reflects its commitment to meeting client needs and capitalizing on the evolving landscape of digital assets. This innovative approach not only enhances the earning potential for clients but also strengthens the bank’s position as a leader in the crypto lending sector.