foreword

Recently, cryptocurrency wallet MetaMask has launched its Ethereum (ETH) staking feature, which means users can now stake their ETH through Lido or Rocket Pool’s new feature to get paid for it.

In other words, users only need to use the MetaMask wallet to easily choose the amount of Ethereum they want to pledge to get rewards. There is no need to go through a complicated web interface to operate, but users should really do it through a third-party wallet. Pledge?

● Pledge service provider

(1) Lido

Staking can be a lucrative activity for users who do not mind risk. Although the rate of return varies, according to MetaMask, users can earn about 5.22% per year for their ETH deposits in Lido, and 4.59% in Rocket Pool.

According to Lido's website, the value of ETH pledged through its service currently exceeds 6.9 billion US dollars, bringing about 4.9% of revenue to users every year. Lido is a so-called liquid staking provider, which means that users who pledge ETH through Lido will receive an equivalent amount of Staked Ethereum ( stETH ) as a staking reward. This enables stakers to keep funds “liquid” while locking up ETH, allowing them to use their stETH on other DeFi services.

Staked Ethereum is currently trading slightly below ETH. While the price of ETH is around $1,418, stETH is trading at $1,407, according to CoinGecko data.

Additionally, Lido is currently the most popular staking service provider according to Dune Analytics, accounting for 29% of all ETH staking.

(2) Rocket Pool

Rocket Pool is another liquidity staking service that offers users rETH in exchange for their staked tokens. However, the Rocket Pool on MetaMask seems to have reached its maximum capacity, which means that users can only choose Lido to pledge ETH on MetaMask.

So far, how many people have pledged through MetaMask? Abad Mian, MetaMask's product manager, did not provide exact numbers, but told the Decrypt team that "the 10% rollout started yesterday and the full rollout is today. Since four hours after the press release, we've seen an encouraging level of engagement."

(3) Coinbase

In addition to MetaMask's two staking service providers, Coinbase, Binance US (Binance US), Kraken, and Nexo also provide Ethereum staking services, and each exchange has a different rate of return. Of these centralized staking providers, only Coinbase and Nexo currently offer liquid staking options, returning Coinbase’s Wrapped Staked ETH (cbETH) token and Nexo Staked Ethereum ( NETH ), respectively.

According to the coinbase official website, the current pledged Ethereum can get nearly 6.85% return. At the same time, the exchange also supports the purchase of cbETH on the decentralized exchange Uniswap for pledge and misappropriation of assets.

(4) Binance US (Binance US)

Binance announced the launch of the Ethereum staking service in September last year, which can obtain a return rate of nearly 6% per year. At the same time, a minimum of 0.001 Ethereum can be pledged (currently about $1.5). But relatively, the Ethereum pledged in Binance cannot have cbETH as a liquid pledged token like Coinbase.

(five) nexo

Pledge Ethereum on Nexo, and Nexo will return you the same amount of NETH (Nexo Staked Ethereum). At the same time, you can also be a "node" of Ethereum and enjoy the rewards of staking. NETH can also do other transactions like cbETH. And once you exchange NETH, your Nexo wallet will receive a certain percentage of rewards every day, and the rate of return ranges from 4% to 12%.

(6) Solo staking

Of course, Solo staking is also an option, but users need to prepare at least 32 Ethereum (about $45,800) to do so.

The Ethereum official website stated that any other pledge method cannot directly help the network improve security. In other words, staking directly through Ethereum is the most direct and safest direct pressure mode, but 32 Ethereum is indeed too heavy a burden for the general public.

● Pledge income

Since Ethereum is a proof-of-stake blockchain, theoretically, over time, more and more users globally pledge Ether and run verification nodes to make the network more secure and decentralized. This may be a good thing for a fast chain network, but it is also criticized because it will be more centralized than Bitcoin.

It also seems relatively easy to generate passive income through staking rewards for some long-term holders who do not intend to sell or trade their ether immediately in the short term.

● Pledge risk

However, there seems to be risks associated with staking Ethereum through a third-party platform. There is a common warning in cryptocurrency: "Not your keys, not your coins." (Not your keys, not your coins) This concept has gradually gained attention with the collapse of Terra and FTX. Recently, with a series of asset ownership disputes caused by the closure of the encryption exchange Gemini’s “Earn” program, should cryptocurrency holders hand over their cryptocurrency to a third party? What are the risks? What do Ethereum developers think?

MetaMask parent company ConsenSys explained what it sees as the main risks posed by staking ETH in a post last month. He specifically pointed out three aspects: problematic third-party software, flawed smart contracts, and potential risks of large token price fluctuations.

It also includes the risk of bad decision-making by DAOs related to third parties, code transmission issues, "legal uncertainty" and the possibility of private key leaks. While all of the above may seem unrealistic, each of these risks could be realized if a user accidentally leaks their data, or a powerful third party makes a game-changing move.

● Pledge withdrawal

Before considering staking Ethereum, users must know that the currently pledged ETH cannot be withdrawn. This may come as a shock to some, as it means that staking is currently a one-way flow of money, but ethereum developers expect to change that soon.

The "Shanghai Upgrade" to be launched early this year will support pledged ETH withdrawals. "After the Shanghai upgrade, stakers can choose to withdraw their rewards or stake from their validators," the Ethereum Foundation wrote on its website.

Ethereum developer Marius van der Wijden told Decrypt that withdrawals are expected to arrive in March. As for whether ethereum holders should stake their ether, he said “people should listen to their gut feeling whether to stake now or in a few months.”

"The withdrawal code is almost complete, but it still needs to be thoroughly tested before rolling out," he said.

● Pure decentralization?

The transfer of Ethereum from pow to pos is undoubtedly a good thing in terms of environmental protection, but the ensuing criticism has made the public refocus on the so-called "centralization" and "decentralization" issues: pos leads to an obvious The question ─ ─ can the rich seem to be the center of the chain? (but pow is essentially the same)

Here, I would like to put forward some thoughts of my own, what is pure decentralization? If it is completely decentralized, does it also mean that human nature is no longer trusted and trusted? Does true decentralization also mean true automation, stylization, and dehumanization? Just like the most primitive DAO concept, the most just political behavior is executed by the program?

First of all, we must first clarify that the concept of "decentralization" is originally a problem of spectral positioning, so we need to define the most extreme and purest "decentralization" first. In my opinion there are two aspects:

1. Pure stylization, the exit of human nature, the utopia of technology.
2. Human beings who trust each other, technology is only auxiliary, a utopia of humanity.

That is, when the veil of ignorance is closed, should you believe in technology, human nature, or both? The reason why blockchain technology is important is precisely because it ignites the flame in the aspect of "utopia of technology", but we must not forget that in the entire process of the development of human civilization, various political philosophies have contributed to the issue of "human nature". various efforts. On the other hand, the development of modern political philosophy often presupposes that human nature is evil and unpredictable, so various social and political systems are designed to contain the unruly nature of human nature.

And technology? In modern times, humans seem to presuppose science as "good" and "just". But is this really the case? Is technology itself really neutral? Since the utopian development of human nature revolves around "inhibition", does the utopia of technology revolve around "endless development"? We may not know the answer yet, but it may be soon.

Therefore, I think that since pure utopia itself is a vain fantasy, how to find a "better" social system and resource allocation model is the most important task. After we define the purest decentralization, the next question may be what is wrong with the current society? Where are we? Where should we go?

References:

coinbase, How to stake Ether

Binance US Launches a 6% APY Ethereum Staking Service

Ethereum Smart Staking Is Live on Nexo!

Solo stake your ETH

You Can Now Stake Ethereum on MetaMask—Should You?

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