Liquid staking for ETH 2.0 without lockups or rewards slashing

Liquid Staking for ETH 2.0

The long-awaited Ethereum 2.0 upgrade is set to launch on December 1st, marking a major step for the Ethereum blockchain, shifting the consensus mechanism from Proof-of-Work (PoW) to Proof-of-Stake (PoS). 

Ethereum 2.0’s beacon chain genesis is set to launch at the earliest possible launch date of December 1st. Everyone can still participate in this “historic moment” in blockchain. It is not too late to stake your ETH, but you have to choose between different options. While staking on Ethereum will lock up your ETH, you can easily stake on StakeHound, not giving up the control over your funds.

Staking with Ethereum 2.0

The Ethereum network is the blockchain’s biggest network to transition to Proof-of-Stake (PoS) from Proof-of-Work (PoW). This was confirmed following the transfer of 524,288 Ether (ETH) from 16,384 validators into the Eth 2.0 deposit contract, which went live on November 4. Transfers to the deposit contract increased rapidly from 23rd to 24th November 2020, with over 200,000 ETH sent in just 24 hours. This long-awaited transition to ETH 2.0 promises upgrades that will improve the security, scalability, and sustainability of the Ethereum blockchain. While its improvements are promising, most users are left to face a pivotal decision of whether they should stake with ETH 2.0 or not. 

ETH staking requirement and reward slashing

Staking with ETH 2.0 promises users steady staking rewards, including high yield savings. But while the staking returns seem generous, the staking requirements might be too high and restricting for many users. To stake with ETH 2.0, users are required to stake a minimum of 32 ETH, which is currently worth about US $16,000+. Apart from the high entry point, users are expected to lock-up their stake for a minimum of 18 months.

Not only are these staked ETH rendered illiquid, but also users must host their own nodes and infrastructure acting as validators, with a risk of reward slashing. Slashing means that a significant part of the validator’s stake can be removed: up to the entire stake of 32 ETH in the worst-case scenario. Slashing can happen if users are unable to perform their duties as validators properly. On top of all of this, users will not receive any compound interest on their staked returns. 

With all of these limitations, potential stakers on ETH 2.0 are faced with serious questions: would it be best to run your own node and complete all the complicated and tedious tasks of a validator, or should you stake your ETH with a third party staking provider platform that can provide you with more freedom with your stake?

Staking with StakeHound

For users interested in staking with ETH 2.0 but are skeptical about its restrictive nature, staking with an alternative staking platform is the best option. StakeHound is a liquid staking platform that allows users to enjoy all the benefits of staking while removing the restrictions that come with it. 

When staking on ETH 2.0, users must maintain a node, bear an 18-month lock-up period, and provide a minimum of 32 ETH. StakeHound removes these limitations by enabling users to stake without lock-ups and a minimum entry staking requirement. This means that anyone can stake their ETH without needing significant capital. Best of all, users are not required to run their own nodes. 

Apart from these benefits, users who stake on StakeHound will receive stETH, which is a 1:1 wrapped version of the staked ETH, allowing them to freely participate in decentralized finance (DeFi) products and services as lending, borrowing, or yield farming. With this solution, users can now enjoy the high yields of staking, as well as many benefits DeFi has to offer. Overall, StakeHound provides freedom from all the restrictions users are faced when staking with ETH 2.0 while providing additional benefits such as immediate liquidity.

 

Criteria

StakeHound

Ethereum 2.0

No Lock-up period

18 months

No Minimum deposit

32 ETH (US $16,000)

No Reward Slashing

X

No nodes & infrastructure

X

 

Conclusion

Staking with ETH 2.0 has many benefits and promises to provide high yields for users who will participate. However, users have shown skepticism about staking on the ETH2.0 platform because of its restrictive nature and limitations. Alternative liquid staking platforms such as StakeHound allow users to experience all the staking benefits without drawbacks. 

 

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