Coinbase Exchange has launched Avalanche (AVAX) staking, setting the stage for the coin's price to soar in the short term
Coinbase Exchange has announced the launch of Avalanche (AVAX) staking as the American trading platform seeks to expand its industry dominance. The launch of Avalanche staking marks a pivotal moment for both the protocol and the exchange, considering how controversial the “Staking” subject is in the United States.
The Coinbase Avalanche Staking Offering
As Coinbase announced, it will be offering the Avalanche staking with an Annual Percentage Yield (APY) of 4.47%. In compliance with extant regulations, Coinbase issued a set of disclaimers regarding the product.
One of its core warnings is that the valuation of digital currencies can change as they are generally volatile in nature. The trading platform cautioned its prospective Avalanche stakers to be ready to lose their funds unannounced. Additionally, Coinbase noted that despite its caution, the risks associated with crypto products may be difficult to understand.
Based on this, the exchange said users may need to conduct their own research before choosing to Stake their Avalanche token.
“Lack of protections: Crypto-assets are largely unregulated and neither the Financial Services Compensation Scheme (FSCS) nor the Financial Ombudsman Service (FOS) will protect you in the event something goes wrong with your crypto-asset investments,” the exchange said on the Avalanche staking page, adding that users should not put all of their assets into a single basket as that might be risky.
The choice of Avalanche by Coinbase is understandable for Coinbase. Avalanche is one of the top Layer-1 blockchain networks regarded as the fastest in terms of Time-to-Finality. Avalanche aims to offer a higher Transaction Per Second (TPS) of around 4500 compared to Bitcoin’s 7.
The inclusion of AVAX in Coinbase’s staking feature marks a major validation for Avalanche. This might ultimately place enormous demand for the coin, driving prices higher in the long term. At the time of writing, Avalanche is down 8.35% in 24 hours with its price pegged at $36.80. With the staking news, there might be a turnaround in the coming days.
Navigating Staking In the Crypto Ecosystem
The crypto ecosystem has had a fair share of regulatory struggles with the United States Securities and Exchange Commission (SEC). One of the major avenues for this regulatory friction hinges on Staking which the SEC termed a securities offering.
Over the past few years, the SEC has sued and settled with Kraken over this product type. At the moment, spot Ethereum ETF applicants are removing the staking clauses from their applications. This is to prevent any form of denial by the regulator as anticipated.