Kraken Institutional is making it easier for large investors to put their digital assets to work. The crypto exchange’s institutional arm has teamed up with Upshift, a multi-chain vault infrastructure provider, to offer eligible clients access to onchain yield opportunities, directly from their existing Kraken custody accounts.
The integration enables institutions to earn yield on idle bitcoin, ether and stablecoins without moving assets into separate wallets, onboarding multiple providers or managing the complexity of interacting with decentralised finance (DeFi) protocols.
Instead, clients can access curated yield strategies under one roof, custody, trading, financing and onchain investing through Kraken’s qualified custody platform.
What will the partnership include?
The partnership seeks to tackle one of the biggest challenges institutions face when considering DeFi; the need to balance secure custody with the ability to earn a return on digital property.
The new offering allows eligible clients to deploy assets from their custody accounts into vaults created by Upshift for permissioned use. When assets are allocated, clients receive a receipt token representing their position. Kraken holds that token in segregated custody and values it at its redeemable amount, so investors have a clear view of what they own.
Kraken stated that the receipt tokens are not pooled with other customer assets or rehypothecated in a structure intended to offer more transparency and control.
Upshift’s dedicated vaults are customised to each institution’s investment objectives, preferred assets, liquidity needs and risk profile, as opposed to traditional DeFi pools that pool funds from many users.
The vaults can power strategies in decentralised finance (DeFi), centralised finance (CeFi), payment finance (PayFi) and tokenised real-world assets on over 30 blockchains, the companies said.
Kraken expands into institutional yield
Kraken is trying to make custody more than just a place to store digital files with the launch.
The platform already offers institutional services such as qualified custody, prime broking, OTC trading, exchange execution, staking and financing. “Kraken’s mission is to provide institutions a single platform to safely custody assets and utilise them through bespoke yield vaults.
“Custody should be the beginning, not the end, of what institutions can do with their assets,” said Gregory Barasia, Head of Asset Management at Kraken Institutional, in a statement.Vaults are the next step to making Kraken Custody the most efficient home for institutional capital to sit.”
Institutional investors have always had to choose between keeping their assets safely stored or putting them to work to generate returns’, said Upshift CEO and co-founder Aya Kantorovich.Kraken and Upshift take away the operational overhead of sourcing yield efficiently across exchange, OTC and onchain markets that have kept capital idle,” she said.
The partnership comes as institutional interest in digital currencies is growing, with more firms looking to go beyond simply holding cryptocurrencies and toward generating returns through regulated, professionally managed strategies.
DeFi has been growing, but many institutional investors have been hesitant to get involved due to fragmented infrastructure, operational complexity and custody concerns. Kraken and Upshift are betting that a simpler path to access through a single regulated relationship will help close that divide.
The firms hope to make decentralised finance more practical for institutional investors by allowing clients to access onchain yield without managing separate wallets or navigating multiple protocols, while still maintaining the governance, reporting and security standards those firms expect.
