Rho Labs and CoinDesk Indices join forces to offer CESR™, a standard benchmark for Ethereum staking

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Apr 17, 2024, 09:03 ET

CESR, by CoinDesk Indices and CoinFund, will enable Rho traders to better express their views on the Ethereum staking rate's trajectory and manage rate risk.

NEW YORK, April 17, 2024 /PRNewswire/ -- Rho Labs, developer of the interest rate derivatives protocol, Rho, today announced the upcoming availability of CESR, the composite ether staking rate in Rho markets.

Computed and published seven days a week by CoinDesk Indices—the leading provider of digital asset indices since 2014—CESR is a benchmark rate for the Ethereum staking yield, comprising consensus rewards and priority transaction fees paid to active validators. CoinDesk Indices brought CESR to market in 2023 in partnership with CoinFund—a leading Web3 and crypto-focused investment firm and registered investment adviser—to deliver this important piece of market structure.

CESR will help Rho users manage risk from Ethereum staking yields and transaction costs more efficiently, and lock-in fixed rates of return for counterparties.

Founded in 2022, Rho Labs is constructing a non-custodial, institutional-grade interest rate derivatives market on Arbitrum, fostering secure and transparent on-chain trading for crypto-specific rates such as staking.

"As institutional investors grow their internal digital asset capabilities, we have seen huge interest in the staking economy, with staking yields becoming table stakes for serious ETH-based products and services," said Alex Ryvkin, founder of Rho Labs. "By leveraging CESR, we are excited to deliver the tools that offer traders greater accessibility and pave the way for innovative crypto financial products."

CESR allows assets across the digital domain to be priced as a relative investment to a benchmark Eth staking rate that captures all relevant block rewards paid to network validators and accounts for protocol "slashing" and protocol withdrawals. It also lays the groundwork for the creation of a forward rate curve and can serve as a new discount rate, two critical mainstays of traditional finance.

"Since launching CESR in 2023, we are pleased to see this benchmark rate grow to support crypto-based finance," said Alan Campbell, president of CoinDesk Indices. "We are excited for industry leaders and innovators like Rho Labs to use CESR and accelerate the utility and pragmatic adoption of digital assets."

In traditional finance, interest rates underpin the largest markets in the world and serve as a fundamental pillar of economic activity. Staking rates can do the same for the crypto industry by delivering a new class of standardized benchmarks, powering next-generation financial products, improving risk management, and unlocking new functionality for institutions and consumers alike.

"Staking rates are to crypto what interest rates are to traditional financial markets. CESR was designed to spur investment product growth and new opportunities for risk management across global finance, thereby unlocking the utility of the $500 trillion traditional rates markets across the crypto industry," said Chris Perkins, President of CoinFund. "We are thrilled Rho Labs and other industry leaders are adopting CESR to unlock opportunities on the Ethereum blockchain."

For more on Rho Labs, please visit https://www.rho.trading/.

For more on CESR, please visit: coindesk.com/indices/ether/cesr.

About CoinDesk Indices
CoinDesk Indices has led the digital asset revolution, empowering global investors since 2014. Backed by Bullish, our indices are the cornerstone of the largest digital asset products worldwide. Precision-driven and compliant, indices like the CoinDesk 20 set the standard for measuring, trading, and investing in crypto. Over $30B in assets are benchmarked to CoinDesk Indices' products. CoinDesk Indices' trend signals empower smart beta and alpha-seeking strategies. Ready to achieve your digital asset goals? Visit coindeskmarkets.com for more.

About Rho Labs
Rho Labs is the developer of Rho Protocol, a novel institutional-grade decentralized marketplace on Arbitrum that allows retail and professional traders to exchange interest rate risk via on-chain swaps and futures in a secure, efficient, and compliant manner. Rho Protocol's first family of products are fixed-for-floating interest rate futures on a diverse set of index rates. In TradFi, this product comprises over 60% of the total outstanding interest in interest rate derivatives.

CoinDesk Indices disclaimer:
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SOURCE CoinDesk Indices