Svmuu News According to CoinDesk columnist Jordan Knecht, some traditional financial institutions view staking as carrying risks such as slashing, downtime, operational failures, and unpredictable returns, leading them to only hold spot ETH or avoid related assets.
Jordan Knecht mentioned that a new generation of insurance-backed staking products are using the Composite Ether Staking Rate (CESR) as a benchmark and are underwritten by regulated insurance institutions, making staked ETH more akin to institutional yield products rather than crypto experiments.
It was disclosed that CESR is a daily standardized benchmark rate developed by CoinDesk Indices and CoinFund, used to measure the average annualized yield for ETH validator staking; Chainproof, in collaboration with IMA Financial Group, provides insurance policies that compensate for returns when validator yields fall below CESR and provide payouts in the event of slashing. These arrangements are also being used to support the design of collateral, rebalancing, and structured strategies based on staked ETH. (CoinDesk)