Key Highlights
- BitGo Bank & Trust, N.A. has rolled out institutional Bitcoin staking in partnership with Stacks, enabling qualified custody clients to earn BTC rewards while maintaining custodial custody.
- Participants must commit an STX position worth 5% of their staked Bitcoin value for a lockup duration of approximately six months, targeting an annual yield of around 3%.
- The model is powered by Stacks’ Proof of Transfer (PoX-5) mechanism, where miner-committed BTC funds the rewards, while BitGo provides separate address support to streamline accounting for ETF and ETP issuers.
Institutional digital asset custodian BitGo Bank & Trust, National Association, has expanded its institutional offering by introducing native-denominated Bitcoin staking rewards directly from qualified custody accounts. Announced in partnership with Bitcoin layer-2 network Stacks, the arrangement allows institutional investors to generate yield on their held Bitcoin without having the underlying assets leave regulated qualified custody.
Bitcoin staking from BitGo Bank & Trust, N.A. accounts is here.
Eligible qualified custody clients can now earn $BTC rewards on bitcoin that stays in BitGo Bank & Trust custody through Bitcoin Staking with @Stacks.
Rewards are paid in $BTC, funded by the $BTC that Stacks miners… pic.twitter.com/OXJUrHRUEaAdvertisement— BitGo (@BitGo) November 3, 2026
Institutional Staking Architecture and Lockup Requirements
Under the custody arrangement, BitGo Bank & Trust, National Association, serves as the qualified custodian throughout the staking duration. Assets remain preserved in a timelocked vault directly on the Bitcoin network, with Stacks supplying the underlying execution layer to drive returns. To participate, institutional investors are required to lock an STX position equivalent to 5% of the total fiat or asset value of their staked Bitcoin. Both the BTC and the STX assets are locked for a tenure of roughly six months, after which the original Bitcoin principal is released according to the bond terms.
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Unlike many standard yield-bearing decentralized protocols that issue secondary protocol tokens, distributions under this service are denominated in native Bitcoin rather than STX. Stacks founder Muneeb Ali indicated a target annual yield rate of 3%. However, realized payouts remain variable, depending directly on miner engagement, network fee volumes, and payout scheduling. BitGo has also built administrative flexibility into the setup, supporting segregated wallet addresses for reward yields and principal balances. This operational separation is designed specifically to assist exchange-traded fund (ETF) and exchange-traded product (ETP) managers in meeting distinct accounting and regulatory standards.
The Mechanics of Stacks Proof of Transfer (PoX-5)
The yield process operates via Stacks’ proprietary Proof of Transfer (PoX-5) consensus system, which cryptographically links transactions on the Bitcoin base chain with activities on the Stacks blockchain. Because the base Bitcoin layer relies on Proof of Work and lacks a native staking mechanism comparable to Ethereum, the PoX framework achieves consensus by having Stacks miners commit native BTC to earn mining rights for new Stacks blocks. The BTC transferred by these miners serves as the funding pool for rewards distributed to enrolled participants.
Data highlights substantial liquidity commitments behind this structure. According to a November 3 report by Alea Research, the inaugural Genesis Bond launched on September 10, bringing together 230 BTC alongside approximately 3.57 million STX. Across its initial complete payout timeline, incoming miner transfers satisfied the bond’s required payment schedule by 17.9 times, comfortably exceeding the 2x coverage requirement mandated under SIP-045.
Why This Matters
Institutional Bitcoin holders have traditionally encountered trade-offs between asset safety and capital efficiency, with yield-generation strategies often requiring assets to migrate to non-custodial or higher-risk decentralized platforms. By embedding Stacks’ PoX-5 yield architecture inside BitGo Bank & Trust’s qualified custody perimeter, institutional fund managers, corporate treasuries, and ETF issuers gain a compliant framework to earn native BTC yield while adhering to strict fiduciary mandates. Furthermore, the operational segregation of principal and yield simplifies tax reporting and compliance, marking an evolution in institutional product design for the digital asset sector.
Frequently Asked Questions
In what currency are the staking rewards distributed?
All staking rewards generated through this program are denominated and distributed directly in native Bitcoin (BTC), rather than in the Stacks native network token (STX).
What are the lockup requirements for participating institutions?
Participants must commit an STX position worth 5% of their total staked Bitcoin value. Both the Bitcoin principal and the auxiliary STX capital are committed for approximately six months before becoming accessible under the bond terms.
How does Stacks fund the Bitcoin staking rewards without native Proof of Stake?
Rewards are funded via Stacks’ Proof of Transfer (PoX-5) consensus model. Instead of relying on a native proof-of-stake chain, Stacks miners transfer BTC to compete for block validation rights on the Stacks network; these miner-spent Bitcoins are subsequently directed to eligible bond participants.
