Crypto 're-staking' platforms boom as traders chase bigger returns

FILE PHOTO: Representations of cryptocurrency Bitcoin are seen in this illustration picture taken in Paris, France, March 9, 2024. REUTERS/Benoit Tessier/Illustration/File Photo

LONDON (Reuters) - More than $18 billion worth of cryptocurrency has moved into a new type of platform which offers investors rewards in exchange for locking up their tokens, in a complex scheme that analysts warn poses a risk for users and the crypto market.

The soaring popularity of so-called "re-staking" is the latest sign of risk-taking in crypto markets as prices rally and traders hunt for yield. Bitcoin, the biggest cryptocurrency, is near all-time highs while ether, the second biggest, is up more than 60% this year.