Asset sales margin decreased to 17 basis points compared to 32 basis points in the first quarter and 19 basis points in the prior year period. Turning next to staking, our revenue was $64.7 million, up 30.9% sequentially, but down 28.8% year over year. Staking fees were $60.8 million, dollars, resulting in a take rate of six percent compared to a take rate of 16.1 percent in Q1 and 10 percent a year ago. Normalized asset staked increased three percent sequentially and 36.1 percent year over year. The sequential increase in revenue was driven primarily by substantial new staking activity from a large institutional client. While this relationship contributed meaningfully to revenue growth. It carries a lower contractual take rate compared with our historical average. In addition, we experienced softer revenue contribution from another large client, which also weighed on overall margins. Staking economics will continue to vary based on client, token, validator, and transaction mix. Our focus is on continuing to grow the asset base while improving the mix of higher value activity over time. The next component is subscriptions and services, where revenue was $27.5 million, up 7.7% sequentially, and up 8.5% year-over-year. The sequential increase reflected continued client growth and activity, together with increased project-based ecosystem and implementation work. our custody and wallet relationships remain the foundation of the platform our priority is to convert more of those relationships into recurring multi-product revenue rounding out our business line review is stablecoin as a service where revenue was 38.8 million dollars up 1.7 percent sequentially and 148 percent year over year stablecoin sponsor fees were $35.7 million, resulting in a take rate of 8% compared to 7.4% in Q1 and 2.6% a year ago. Sequential growth was supported by higher reserve balances and fixed monthly fees from newly supported stablecoin programs. The pipeline is healthy and we continue to see opportunities to expand the number of stablecoin programs supported by the platform. Turning now to expenses. Expenses excluding direct costs were $59.9 million, down 13% sequentially and up 38.9% year-over-year. The sequential decline was primarily driven by a 27.6% decrease in compensation and benefits expense from $40.8 million to $29.5 million, reflecting the normalization of IPO-related share-based compensation, together with lower cash compensation. Professional fees also declined sequentially. Compared to the prior year, operating expenses increased primarily due to higher employee-related costs to support platform growth, as well as additional legal and administrative expenses associated with becoming a public company. During the quarter, we also recorded a $1.3 million dollar restructuring charge related to the workforce reduction implemented at the end of q2 the nine million dollars of annualized cost savings from this restructuring and the additional six million dollars of annualized cost savings from other initiatives are expected to begin benefiting our operating results starting in the third quarter on the balance sheet our positioning remain strong. We ended the quarter with $159 million of cash and cash equivalents and continue to maintain a balance sheet with no corporate level debt. In addition, our corporate treasury held $2,523 company-owned Bitcoin with a fair value of approximately $148 million as of the end of the quarter. Our capital allocation priorities remain maintaining regulatory and operating liquidity, supporting client activity, funding selected organic investments and strategic opportunities, and returning capital when appropriate. In June, our board authorized a share repurchase program of up to $50 million. Repurchases are discretionary and will depend on market conditions, liquidity, regulatory capital requirements, and other uses of capital. Finally, before moving on to guidance, I'd like to clarify that all IPO lockup restrictions expired on May 15, 2026. To close, I'll review our outlook for the third quarter. Digital asset market conditions remain challenging during the quarter. Our outlook assumes that the market activity and digital asset prices remain broadly consistent with recent levels. For digital asset sales, we expect reported revenue to be relatively flat versus Q2 performance, reflecting a similar product mix between spot and derivatives. For staking, we expect revenue to remain broadly consistent with the second quarter. For subscriptions and services, we expect sequential growth supported by continued client activity and project-based ecosystem and implementation work. For Stablecoin as a Service, we expect modest sequential growth, supported by increased reserve balances from existing issuer programs and continued client adoption. We expect expenses, excluding direct costs, to decline sequentially, reflecting the benefit of the workforce reduction and other cost reduction efforts across the organization that Mike highlighted earlier. Before we open it up for questions, I want to say how grateful I am for the past six years. It has been a privilege to help build this company, and I'm proud of what our team has accomplished together. BitGo's journey is far from over, and I look forward to continuing to work alongside this team through the transition and supporting the company's next chapter. With that, Operator, please open the call for questions.

Thank you. And we will now begin the question and answer session. If you have dialed in and would like to ask a question, please press star 1 on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press star 1 a second time. If you're called upon to ask your question and are listening via speakerphone on your device, please pick up your handset and ensure that your phone is not on mute when asking your question. To be able to take as many questions as possible, we ask that you please permit yourself to one question and one follow-up. Again, it is Star 1 to join the queue. And our first question comes from the line of James Yarrow with Goldman Sachs. Your line is open.

Good afternoon, and thanks for taking the question. Mike, I was hoping you might be able to talk a little bit about custody, business market structure, and digital assets going forward. Do you expect to see substantial consolidation in crypto custody providers? I guess do you think we should see only a few custody providers over time? Like we have in traditional securities markets, a different market structure or something else, and perhaps why.

Thanks, James. Good to hear from you. Let's see. In terms of number of custodians, I guess it's, I think, too early to call how many there will be. Right now, it does seem like a lot of folks want to get into the space and do digital asset custody direct. As market structure comes in, obviously it's going to consolidate on a few players, but also this is a global market. So being that it's a global market, it's not going to be just a U.S. regulated thing. It's going to be regulated differently kind of all around the world. So from Bitco's point of view, this is why we are excited and happy to be an infrastructure provider at multiple layers of the stack. We've got clients that take our technology, where it's self-custodial to them, but then they can put it into a custodial manner under their licensing of wherever that whatever that might be in their jurisdiction we can provide custody direct we can provide sub custody to another custodian etc and then how this kind of shakes out over time i mean i think we'll see how it goes it's probably just too early to to call the other thing that's happening of course is we're digitizing everything right so we have had a lot of excitement about crypto over the last decade and then now we're talking about real world assets which have grown tremendously 30 $40 billion in size today. And then we've got, you know, the U.S. equities markets and potentially others coming on on chain as well. So exactly how that's going to shake out kind of on a global basis. I don't know. Bitco's technology and Bitco's business should be well poised in all of those scenarios.

Excellent. Thank you. Just maybe one other one on regulation. The Clarity Act does appear less likely to pass in the very near term. We do have the SEC innovation been discussed recently in the news that's potentially coming out. Could you just discuss your view for how tokenization could evolve if we don't have a Clarity Act to pass this in the near term and what the SEC innovation exemption would mean?

Sure. Let's see. First off, actually, BitGo might be in some way selfishly better off without clarity. And that's because we know how to operate this, and we understand the risks that we're taking. We've been doing it for a dozen years, and we feel very comfortable with what we're doing. We're doing it with some of the best regulators here in the U.S. and abroad. They're comfortable with what we're doing. So we think we can continue to operate. The sad part about not getting clarity is really for consumers and investors. it means there's going to be fewer participants it means that some of the traditional players that might have been willing to come in with a clarity kind of oversight uh will say like hey maybe we'll wait for for a clarity act to fully pass so i think it just delays things uh overall i think that's negative for u.s markets if it can't get done i'm still optimistic it will get done uh you know i wouldn't say that i'm expert or interested enough in the politics side of what's going on in order to weigh as to whether it'll win or not. But look, I think BitGo will do just fine. Globally, also remember, we've got custodians who operate around the planet. It could be that we start to see other jurisdictions become better for digital assets, and then those markets will move there. Prior to the current administration coming in and providing a lot of pathways for digital assets, you know, we had been building outside the U.S. It's part of why our trade accelerated in 2026 is because we have been building that, assuming we wouldn't have had such a good tailwinds as we ended up with under the new administration. So either way, the digital asset industry is going to keep going forward. There's really no way to stop this. It's happening at a large level right now.

That's very helpful. Thanks a lot.

And our next question comes from the line of Pete Christensen with Citi. Your line is open.

Good evening. Thanks for the question. Nice demo, Mike. That looked real sharp. I wanted to ask about the quantum-resistant wallets. How much do you see this as a competitive feature? Is this something that is like an upsell type of product, or is it more broadly available across the BitGo platform? just trying to get a sense of how this could help drive incremental share.

Look, actually, it's inspired to some degree by this process. So BitGo, I think, is one of the early folks. I know Coinbase was out public earlier than us. But being out on the roadshow a year ago, heard from all these investors that really haven't been very close to digital assets previously because we didn't have a climate that was conducive to all of this. And they're asking about quantum, quantum, quantum. And I was really surprised by it. My personal fear about the quantum threat is very low. However, you know, I think it's imperative upon us that are in the industry to go and help pioneer and make sure that we can satisfy, you know, mitigations against those fears and help people understand. So it's a very simple thing that we're doing. We would be happy to have every single wallet on the planet do exactly what BitGo is doing. So in terms of competitive advantage no it's not intended to be a competitive advantage um but i think bit goes poised well to do this uh it gets down into the technicals of bitcoin which probably isn't appropriate for this call but we've been kind of on the front edge of how you do spending inside of a bitcoin wallet for a very long time all this is is we're changing that instead of being prioritized towards low low fees instead we prioritize towards quantum resistance it turns out the fee difference is pretty minimal um and look every wallet should be doing this i think it's a really simple approach that we can take as an industry to ease the fears that some people have about quantum computing. And by that, I don't want to take away, there's still more to be done on quantum computing. It's just that like, if you put your assets today into a BitGo wallet and you watch your quantum resistance score, you actually are not vulnerable holding your assets in that wallet if a quantum computer were to come online tomorrow.

That's helpful. And then I'm just I'm just curious if you could just take us through some of the puts and takes on the Stablecoin-as-a-Service take rate. Is that transaction activity, you know, minting and redemption fees, or is that just a larger flow balance? Just if you could help us parse through some of those dynamics.

Sure. On the stablecoin, we primarily generate our fees off of the balance inside of the stablecoin. I think all signals look really good as an industry. I mean, you can see it kind of all around. Obviously, it's competitive with other stablecoins that may not be at BitGo, but overall, we feel like we're growing at a reasonable rate, and we're seeing continued adoption and continued growth on the stablecoins.

Thank you.

And our next question comes from the line of Stephen Warhaftig with Wedbush Securities. Your line is open.

Hey, good evening, guys. Thanks for taking the questions. I specifically want to talk about the competitive landscape, because we're starting to see a lot more competitors really go after kind of the custody market, the stablecoin market overall, the tokenized equities. So how are you looking to position against some of these newer competitors, and then also some of the existing competitors that are starting to really expand more across their portfolios as well?

Sure. Thanks for the question. Look, overall, I think we're poised pretty well. If you look at our normalized assets on platform, I think the results speak for themselves. We're adding billions of dollars of asset on a quarter-by-quarter basis, and we've done that for the last several quarters. What Bitco's been doing here is not just the custody components, but the full stack around it. So there's literally, if you're looking at the bottom of the stack, there's no other provider that's got the full complement of self-custody plus custody. If you want to look at the top of the stack we've got a really robust set of services on top with trading that gets you better fees than anywhere else we got staking it gets better fees than anywhere else of course we got the lend and borrow and things about that so for the new entrance they're going to have to kind of build all of those things i think bico's been doing it for a while and is very well proven so i think we'll do well there on the tokenized equities front which you mentioned look bico took the time and i hope it came out in the demo to do it in a way that you can build as a financial foundation, so to speak. So the early entrance into digital or tokenized equity has been offshore vehicles, non-tradable in the United States, et cetera. And frankly, you don't really know what that is. You can't use it as collateral because you can't perfect the security. What BitGo's done here is it's entitlements. This is UCC Article 8. It's a tried and true thing. It's been done for, I guess, several decades now inside of the traditional financial system. So we're leveraging that. These are actually shares that you own. And you can use them as collateral. It is perfected security. And we can grow from there. So we think that we took the time to get the foundation right. And in part, that's thanks to having had the OCC, you know, National Trust Bank Charter. That's where we do the qualified custody. That allows us to kind of grow this business. Not that many have it. Now, there's a lot of people going and building OCC National Trust Bank Charter. I suppose that could be a thing. But look, we've been doing it for 10 years. I guess on the regulated side, to be more accurate, We've been doing that since 2017, but there's a lot that goes into it. There's a lot of building in the business, both on the technology side and on the business side, that might be underappreciated by some of the newer entrants. So I think we have a long lead ahead of new entrants that are coming to market, and I think also we have a really good stack of services. So we will just continue to try to make sure that we provide the rest of the service, and if we can't do that, then clients should choose somebody else, but we think we'll do okay.

Okay, I understand. And just a quick follow-up, just on the investment strategy moving forward, because you have about, give or take, about $155 million to $160 million in cash on the balance sheet, a decent amount of Bitcoin on the balance sheet as well. But you also have this $50 million of a share buyback. I kind of want to get an idea of what the investment strategy is over the next 6 to 12 months. How much of it is getting allocated towards the AI investments that you talked about on the call? How much is it going towards reinvestments into new products being expanded on the platform? I just want to get a better idea of how you're looking to invest some of the proceeds from from the cash balance. Thank you.

Sure. So from my view, I would call cash and cash equivalents should include Bitcoin. And so therefore, you can add those two numbers and get a little over 300 million. 50 million of that we have earmarked for doing a stock repurchase, as we announced previously. So that'll happen. Usually, I'm not a big fan of stock buybacks. But look, I think we're a special circumstance where actually it does make a lot of sense so that that will proceed um and then on the ai investment actually that's kind of fit within our operating costs so we put that right into you know what we consider to be the cost of doing business and i think on a go forward basis the way you do product development should just include that of course we want to have fantastic engineers and then we want to amplify them with the best tools that they can have that's where ai fits in um so anyway ai is separate it's not it's not like a an investment that comes out of the pile.

And our next question comes from the line of Cassie Chan with Wells Fargo. Line is open.

Hey, guys. Thanks for taking my question. I guess first I just wanted to dig a little bit deeper on the digital asset margin. You know, I think you guys said that was 17 basis points in 2Q, which decreased due to the mix of spot and then the lower mix from derivatives. I guess where does the derivatives mix stand relative to the $3 billion in the total volume I believe you disclosed in 1Q? and, I guess, how should we think about visual asset margins more broadly in the future? Is there some sort of pricing or competition playing a part in that margin as well? Thanks.

So, in Q2, notional volume of our derivatives were roughly around a billion, and that was compared to almost 3 billion in Q1. But overall, we would expect that to continue to grow, which we had a shift in what clients were looking to do. Obviously, you can see that our spot trading business grew very nicely in the quarter. And as far as margins, it was a difficult quarter overall in the industry. And I think we did fairly well, again, growing the top line and hopefully gaining some market share. And we feel very positive about business. And I don't want to say that one quarter is going to be the future margin spread that we expect. We've already seen in the month of July some recovery in that margin. So I would expect it to kind of move back to our historical averages where we were probably in that 20 to 25 basis point range.

Got it. Super helpful. And then I guess just following up on margins, I'll maybe ask a little differently. I guess what are the key levers to return to positive adjusted, but that from here, I know you guys have talked about the $15 million annualized cash savings, and it sounds like 3Q is maybe tracking roughly stable to maybe a little bit higher in terms of, like, net revenue. So, if you call it $3 million, you know, in quarter, 3Q from the cost savings, I guess how should we think about flow through to bottom line versus reinvestment in growth areas? And is it possible that maybe we could get to, you know, maybe a break-even, you know, just deep down 3Q?

Yes. The goal, first of all, is to continue to grow our revenue line items as we add more assets on platform, more assets staked, bring on more clients to our platform and more users. That's going to be the first area of growth to drive revenue and incremental profit. As we talked about, we have done some cost measures by taking out some of the headcount of the company, roughly about 15 percent and we've identified another roughly six million of cost on an annualized basis so we'll start to appreciate that immediately in q3 and the goal would be yes to get the business to closer to break even slightly profitable uh in q3 just answers a slightly different different way um is it okay slightly different way you know the quarters are measured in 90-day increments, but the market is moving kind of on its own cycles and its own patterns.

And so it does lead to a slight mismatch of like the quarterly performance and yet like how things change in terms of derivatives mix versus spot trading mix, et cetera. Overall, driving the business to make sure that we are not losing money is, of course, it's a goal. We want to grow the product lines. And then on the things that we do control, here we feel pretty good. So a number clients is up, normalized assets on platform is up, Q over Q, and then normalized assets under stake also up. I think as long as those KPIs are looking up, then as long as you believe there's a long-term positive trajectory for digital assets, BitGo will win with it.

Got it. Thanks, guys.

And our next question comes from the line of Dan Dolev with Mizuho. Your line is open.

Hey, guys. Thanks for taking my questions. And really, really nice results, despite everything that's going on with uh bitcoin and crypto i have two questions here first uh it was really impressive to see you grow the clients five percent quarter over quarter and pretty significantly even more on a year-over-year basis double digits so can you maybe talk a little bit about where those clients are coming from what you're doing to get those clients us versus international any color here would be great then i have a quick follow-up thanks let's see i'm not sure i have any good data to give you on kind of specific international breakdown I would say that generally this is an area that we've been focused on I mean we put it into our initial KPIs from the beginning we have

a strong belief that the network effect of having everybody able to settle between each other on a single platform is a path to success so we continue to try to make it easier to onboard in spite of having had, I think, probably the best institutional onboarding kind of out there. Actually, AI has just been used to make it even easier. I can go into details of this kind of boring product stuff. And then internationally, you know, the regulated entities that we have are relatively new. So as they get more established and more known, those can grow as well. So look, we continue to focus across all of the product managers and sales teams to make sure that we're growing the number of clients. And then hopefully that's going to continue to bear fruit on the KPIs.

Great. And then maybe just a follow-on on the Stablecoin as a Service here, some high-level thoughts here. Can you walk us through how you think about Stablecoin in the long term, say like five to 10 years?

Is there a cohort of winners and how do you view the world of stable coins given that you're so levered to it and you have a lot of initiatives there thank you uh yeah look uh stable coins are also benefit from a network effect right the larger you are the more the parties that have it accepted understand it etc so it it will probably always have a couple that are are dominant now how many of those are going to be i guess that's still the question uh as you're aware there's a long list of banks and traditional financial companies that are still launching even now kind of their own stable coins and they will each go to their distribution channels and try to make it work so that's one aspect but you know actually the the regulation also has a big impact here so the reality is i think it's wrong but the u.s does not allow a stable coin issuer to give yield to the retail clients that hold the coin. They should, but they don't. So the result of that is if you are any large institution with your own distribution channel of any sort, you have a choice. You can either use an existing stable coin, and the issuer of that stable coin will earn all of the rewards, or you can create your own. Now you've got the difficult work of having to do that. I think we're going to see some more technical innovations from Bitco, probably from others too, which make it ever increasingly easy to kind of build a stablecoin that's your own that you can then claim the rewards on as the issuer of it. And that's going to lead, at least for some period of time, to a continued proliferation of new stablecoins. So we'll see how it plays out. I mean, it's still the early stages. Like anybody that's tried stablecoins can recognize that the payment process is so much easier and so much better than what you have with traditional finance, that it's clearly going to continue to take off. And I think the investments from Visa and MasterCard and others all indicate that they are also seeing similar possibilities. So I think it's going to continue to grow. Don't know exactly how many stablecoins there will be in the end.

Great. Thank you so much.

And our next question comes from the line of George Sutton with Craig Hallam. Your line is open.

Thank you. Mike, you have been in this market for a while. You've seen a lot of volatility, very similar to what we're seeing now. I wondered if you could just use that perspective. We're talking all about headwinds on this call. There will be a moment in time, hopefully soon, where we're talking all about tailwinds.

I'm just curious if you can give us your perspective there and how being through these volatile times may influence your work. your work yeah i look forward to the tailwinds too sounds good um let's bring it uh let's see uh yes been through many of these cycles uh i think anyone that's out there having a uh a doubt about what the future looks like should think back to the first principles of what are we doing here um and if you look at bitcoin the value that it provides with it being a truly scarce asset that's not controlled by anyone uh it's just to me obvious that this will have a role in the future It's not going away. It's going to continue to exist. Even if the price is up or down on a quarterly basis over the long arc of time, it will go up in value. Remember, we're measuring it in dollars, and dollars are only going down. Dollars have gone down by 25% over the last five years. We all know this. It's not politically oriented. It's just a fact. So that will continue to happen, and people will find safe harbor in products like Bitcoin. You might argue maybe gold will get there. But look, gold is not digital. It's not transportable. it's not easily used in payments bitcoin is so clearly that's going to work aside from that new use cases are incredibly compelling number one we've got stable coins i think that one's pretty much ready to go and is now in the scaling phase we got tokenized equities and you don't have to take my word for it it used to be just a couple of guys but now you know all the way to the dtcc is excited about taking what they've had for decades and putting it onto digital rails so that's going to create tailwinds as well. Lastly, we haven't talked about DeFi much lately. The promise of DeFi is still real. I think probably anyone in business would agree that we have a lot of regulation here in the United States around how we trade assets of various forms. Smart contracts are the ability to take the rules of how those trades and how that financial activity works and put it on chain in a way that's verifiable by smart contracts and code instead of by people that need to be constantly re-audited and re-checked and re-verified that they're not doing some malevolent material activity. So anyway, I think these are all super active use cases. They're all external to BitGo. They're external to the headwinds that we have right now. I think there's just no doubt that the future will be very, very strong for digital assets one way or another.

Thank you for that. And you earlier this month challenged Anthropic and others to hack your 100 Bitcoin wallet that you created. I'm just curious if you could give an update on how many of those Bitcoin do you still have?

We still have all the Bitcoin. And yeah, for those that didn't see this particular challenge, you know, we've heard a lot about AI and its potential to do various things. And then there's been some in the AI sector asking for regulatory oversight of AI. I am not a strong believer that that will be a good thing in the end. These AI companies seem very insistent on telling us that their new models are so dangerous they can't be trusted in the hands of others, and they need the regulators to come in and So I said, all right, if that's true, here's a wallet, there's 100 bitcoins, go for it. I think it's very safe. We haven't had any significant threat. and then look i think with other things going on in the industry that also contributed we had a lot of focus uh in the last couple of weeks as an industry on how do we use ai on the other side of this which is for making sure we've built up really strong defenses of course here at bitco we've been doing that for quite some time using ai as a tool to help us identify issues as opposed to trying to hack this is a never-ending threat right we have to always keep our guard up and we have to continue to work on it. But yeah, so far, there's been no negative outcome for BitGo as a result of that challenge. I think we'll win that challenge.

Great. Thank you.

And our next question comes from the line of Nathan Frankovitz with Cantor Fitzgerald. Your line is open.

Hey, good evening, guys. Thanks for taking my question. I wanted to touch on prediction markets. You've talked about expanding the number of workflows around the custody relationship. So where do you prediction markets fit within the strategy going forward? And then can you give any color on institutional demand for those products?

Sure. Thanks, Nathan. We announced, I don't know, three or four months ago, I think it was. Yeah, you can now place investments on prediction markets through the Bitco OTC desk. There's been a little bit of activity there. Overall, people are looking, especially if you move to large and large amount of money you need to have same things with any other investment some sort of a trusted custodian that can hold on to the assets that are in flux so bitco provides that capability i think prediction markets are you know newer on the regulatory um scrutiny than some of other parts of digital assets and crypto there's certainly a lot going on a lot to be debated there we'll see how that pans out kind of overall um but uh yeah i do expect this will grow and we figure out a market structure for prediction markets, just like we do for every other type of market.

Great. Thank you.

And our next question comes from the line of Ed Engel with Compass Point. Your line is open.

Hi, guys. Thanks for taking my question, and congrats, Ed, on a good run. I had a question on the plans for the DTCC launching tokenized equities this year. I guess, like, how do you think about the monetization opportunity of equities in general?

It sounds like you're doing trading custody um and then even borrow and just kind of curious um whether that that's kind of on the spectrum and then how do you kind of think about the fee structure on tokenized equities versus just typical digital assets thanks uh sure thank you look there's a bunch of different models going forward so we got the dtcc model we got the figure model we got the pickup model we got the i think ando's got a model we've got the uh uh xdocs model so there's a bunch different models first and foremost all of those types of tokens oh robin hood's got a model uh all of those types of tokens could be held at bitgo so anyone that needs custody or any type of movement that way it can work second thing uh on equities look these are these are securities then you can only trade them through a broker dealer right so the demo that i did you know we did that through our clearing partner um we're not a broker dealer directly so it's not trading fees that we'll be looking for there we're looking to try to open up use cases that frankly didn't exist before So the demo that I did was a small amount of SpaceX stock being held as collateral that you can borrow against. You know, this is something, especially you hear about the K-shaped economy, and a lot of people say, hey, look at that Jeff Bezos guy. He borrows against his stock. He never has to pay it back. And that's not available to, you know, typical Americans. It's available if you have lots of stock, if you're a high net worth, if you're a private world client. It's not available if you're just regular retail. And there's a lot of people out there that have $20,000 or $30,000 worth of stock stock that would like to be able to bar against it on a short-term basis or a long-term basis. So BitGo's initial plan is actually to try to facilitate some of that lending capability, and we think we could do that. It's a new use case that you frankly couldn't really do before. This can run in 24-7 markets. Obviously, you have to use all the same type of plumbing that you would use in lending against digital assets that run in 24-7 markets, and so that's all being built. How it goes with the other efforts, they're each growing in their own way. i think a lot of the exchanges are looking to expand their trading capabilities they make money on trading right so the reason they're offering you know equities based trading is because that's a new product they can offer to people that just want price exposure outside the u.s and they're able to do that that's not not what we're about we're really trying to build the the strong foundation on which you can build all kinds of financial products uh and yes we do actually have several other internal incubating ideas around new use cases that you can do with tokenized equities that you couldn't do in the previous market. Yeah. Anyway, I'll leave it at that.

Okay. Great. And then you quickly mentioned on the broker deal sizes, do you have plans longer term to seek that or for now just not really a focus?

Technically, we actually do have a broker dealer. We don't utilize it and we're not using it for trading.

Great. Thank you.

And our next question comes from the line of Chris Brendler with Rosenblatt Securities. Your line is open.

Hey, thanks. Good evening, folks. Ed, sorry to see you go. Congratulations on your next move. I just want to focus on maybe a little bit of a staking business. We've seen a lot of pressure across staking and a lot of your competitors and to grow sequentially is really impressive. Can you talk about maybe some of the moving parts and maybe sort of the outlook from here?

I know staking is still under pressure from macro perspective but is there a certain reason that you're gaining share and can that continue thank you thank you yeah so what we where we saw tremendous growth was from an existing client that we brought on through a custody relationship and also trading and we're able to win over their staking business uh and that was specifically around ethereum uh so i think there's tremendous opportunity to continue reaching into our current customer set and growing those relationships uh and then as we continue to do more ecosystem projects there's a lot more tokens that will be coming to market that we can also provide staking to so overall the margins are impacted just due to the fact that this larger client we did discount some of the rates just due to the volume we expect to see the absolute dollars of this grow as the token price increase and then we saw another large token that we had in the first quarter that volume dropped off a little bit but we do expect that to start recovering in q3 and into q4 uh just to add to that look directionally we strongly believe that staking and custody go hand in hand you put your assets into a qualified custodian because you know you're a large fund and you need it you're a business and you need of course you have to have it in qualified custody um and then if you want if it's stakeable you want to be able to earn a yield on that and manage liquidity around it these are all services

that Bitco does today. I think that as the industry grows and gets more mature, you're only going to see staking go to qualified custodians. You're going to see the field of staking, independent staking providers just shrink.

Okay, that's great. My follow-up actually is related. Last quarter, we had a pretty significant lift on the Canton network. I think you may have alluded to in that answer, but any other details there, it seems like a really big growth opportunity, especially giving you a relationship with the key parties there. Just give us an update on Canton.

We do believe it's an incredible relationship. Again, we just saw what we were processing as the validator. The volumes drop off a little bit in the second quarter. There's very good communication between the companies and looking to the future.

Again, we think some of that business will continue to grow and get back through sort of the levels that we saw in Q1. one of the things about canton that's of interest like there's a lot of coins out there we've had different periods in the last 10 years where you've got more coins or less coins less new coins being created uh bico we invested heavily in how do you support this long chain of new new coins and that's why we support you know more more coins and more chains than almost anybody else and of course with that you never you never quite know which ones are going to take up the most but the canton team did a great job hitting the institutional market with a couple of you know key features that they need specifically they need a private permission ledger and specifically they needed some privacy components of it so big goes proud we're the only uh qualified custodian on the canton network today but we've been in it for i don't know i guess the better part of a year at this point that's right um and uh you know anyway we it's it's why it's so important to have that technology layer at the bottom once you control that technology layer we can add on to that incrementally, and then we get to the higher level services ahead of competitors.

Great. Thanks so much.

And our final question comes from the line of Brian Dobson with Clear Street. Your line is open.

Oh, thanks very much. So you mentioned converting some custody relationships into multi-product relationships. Which products are you seeing the highest attach rates today? And where's the biggest open space to run?

Usually, it starts with a custody relationship and we see a tremendous amount of opportunity in trading and then also as i mentioned in the example of if it's a thinkable asset we see a lot of business moving to staking so those would be the the two big drivers in addition to that we also have the lending product i think a lot of clients that are looking for additional leverage or looking to borrow dollars or coins are also looking to that. But I'd say that probably the biggest driver is going to be our trading business and staking businesses.

Well, I'd add one more that's not revenue generating much yet, but that's settlement services. You know, we've had the Go network for quite some time. We've got a large client base on it. We've been adding in kind of the stablecoin Mint Burn Center, which we announced, I think a quarter, a quarter and a half ago, I've forgotten. But there you can come in and get direct access to Mint and Burn stablecoins. You can convert stablecoins, et cetera. that makes settlement even easier. So volumes have been growing there. I think eventually that will be a very significant product for us.

Great. Thanks very much.

And ladies and gentlemen, this concludes today's call and we thank you for your participation. You may now disconnect.