ETH2 Staking Guide

ETH Staking Primer

Okay so before I get into it, Ethereum is moving to a proof of stake system from the current proof of work that has nodes mining blocks with hash power derived from their GPUs. Right now, proof of work is securing the network, but there is also a “Beacon Chain” running on proof of stake, and these two concurrently running chains will merge around the end of this year. At that point, mining is over for Ethereum and it’s all proof of stake from then on. It’s important to note that you won’t be able to unstake the ETH until after this merge takes place, which will be Q4 2021 at the earliest.

So with ETH skyrocketing and tons of dApps revolutionizing the digital financial system, everyone who’s anyone wants to stake some ETH. But how? Well, there’s 3 main ways: run your own node, stake in a centralized exchange, or in a DeFi stake pool. Each have advantages and drawbacks. This post is specific to US residents, although many of these options are available worldwide.

Running a node

This option requires you to stake in increments of 32 ETH. If you have that much, I highly recommend considering it. But, if you have that much ETH, I’m sure you’ve already considered it. The technical requirements aren’t very high, you pretty much just need a stable internet connection, since downtime will hurt your returns. Then you install some software on your computer, stake the ETH, and run it 24/7.

https://ethereum.org/en/eth2/staking/

Centralized Exchange

On these you can generally stake any amount

Coinbase- Coinbase takes a 25% fee from any returns and you get the rest. There is no option to withdraw staked ETH, although they plan to allow for it “later this year.” https://help.coinbase.com/en/coinbase/trading-and-funding/staking/ethereum-2-0-staking

Kraken- retains an administrative fee of 15%. Very similar to Coinbase. https://support.kraken.com/hc/en-us/articles/360052734432-Ethereum-2-0-staking-FAQ

Gemini- plans to offer ETH staking, this doesn’t seem to be live yet. https://www.gemini.com/blog/gemini-to-support-ethereum-2-0-trading-and-staking

Binance- this is not available in the US, but let’s face it, a lot of us use it anyway. They offer staking in increments of .1 ETH. https://www.binance.com/en/eth2

Decentralized Stake Pools

Rocket Pool- this is the most well-known DeFi stake pool. They’ll allow .01 ETH to be staked and take a 10% fee. There’s an option to be a node operator with 16 ETH, where the other 16 is provided to you from the pool and you get more of the rewards. They also plan to give you a tradeable rETH token which will allow you to move your staked ETH.

This option is currently not live; audits are being completed. Most guesses on Discord seem to peg a launch date in July or so. https://www.rocketpool.net/

Lido- this is live, but they warn that this is NOT AVAILABLE IN THE US. Use at your own risk. Current rate is 5.5%. https://lido.fi/

Stakewise- this one works much like Rocket Pool. The team is based out of Estonia, they claim that it is legal and available in the US. It’s definitely a legitimate project, with an audited and trustless contract. 10% fee, lower gas to deposit than Rocket Pool, and has their own tradeable token along with a separate rewards token that they plan to use to allow compounding interest, although this aspect isn’t available yet. For people who don’t want to wait for Rocket Pool, this seems like a good option. https://stakewise.io/

These are only a few options. Many more are listed on the Ethereum website; they advise you to DYOR regarding the risks. https://beaconcha.in/stakingServices

Well, there you have it. Tons of options, none of them perfect lol. I’d advise anyone to take their time deciding. Once you put your ETH in one of these pools or start a node, it’s locked up for the better part of a year, so make sure you know what you’re getting into. Happy staking!