BNY Mellon announced on August 4 that it plans to add institutional crypto staking to its custody platform through Galaxy Digital’s infrastructure, pending regulatory approval. The move routes staking for multiple major institutions through a single provider across multiple blockchains, concentrating validator operations in ways that regulators and market participants are beginning to scrutinize.
BNY touches roughly 20% of world’s investable assets, with $62.6 trillion in assets under custody and administration as of June 30. The custodian’s entry into staking infrastructure amplifies existing concentration risks in proof-of-stake networks where a small number of validators already control outsize influence over chain security.
Ethereum concentration thresholds
Validators controlling more than 33% of staked Ethereum can prevent chain finalization if offline or attesting incorrectly. Those controlling above 66% can finalize a preferred chain version outright. About 33% of Ethereum’s total supply is currently staked.
Galaxy is one of three validator firms approved to stake Ethereum for BlackRock’s iShares Staked Ethereum Trust (ETHB). ETHB owns the ETH and collects staking rewards; its custodian holds private keys and controls withdrawals. ETHB’s prospectus warns that slashing, inactivity penalties, and correlated penalties across validators sharing one staking provider can cause unrecoverable losses.
Under normal conditions, ETHB can stake between 70% to 95% of its holdings. If total ETH supply routing through a single provider approaches one-third of staked ETH, that concentration would approach the threshold at which a single entity could disrupt finalization. Figment’s second-quarter report shows it operates 6.26% of all staked Ethereum.
Solana staking concentration
Solana’s staking ratio is around 68% of supply. The smallest group controlling roughly 33% of delegated stake is labeled a superminority. As of August 5, the Solana Nakamoto coefficient measured at 10, meaning the minimum number of validators needed to control 33% of delegated stake is 10.
Total SOL supply needed to reach one-third of active stake is 22.7%. Figment operates 6.96% of all staked Solana. Galaxy runs staking for Solana and other proof-of-stake networks.
Invesco Galaxy Solana ETF lists Coinbase Custody as crypto staking provider and node operator, with BNY Mellon as administrator, showing how staking infrastructure is already distributed across institutional players.
Precedent and mitigation proposals
Ethereum’s May 2023 finality disruption is cited as precedent for how quickly shared infrastructure failures can spread. EIP-8361 proposes burning a larger share of validator rewards as the staking ratio rises to reduce custodial concentration incentives. A 2025 paper on Ethereum’s staking market found solo stakers respond more to reward changes than centralized exchanges or liquid-staking providers.
BNY did not specify which regulatory approvals are required or the timeline for approval. The custodian also did not disclose whether the staking service has launched or remains in planning stage.
