The Beacon Chain Unveils the Prelude to Ethereum 2.0 and Presents a Practical Manual for Staking
Author: Dmash
Author: Dmash
After the Ethereum 2.0 Phase 0 beacon chain reached the minimum threshold for staking at a speed exceeding market expectations in a short period of time, the enthusiasm for market participation has not weakened, and the amount of funds pledged in the contract is still showing an upward trend. The launch on January 1st also slowly unveiled the "mysterious veil" of Ethereum 2.0, a huge, complex ecosystem that many people are looking forward to.
In this context, various staking solutions have emerged in the market, and a new wave of competition has gradually formed. How can users choose a high-efficiency staking solution while ensuring low cost and low risk among many projects? , High-yield solutions, and what risk points do we need to pay attention to?
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Ethereum 2.0 Staking Entry Barriers
After Ethereum is upgraded to 2.0, the consensus mechanism will gradually shift to the PoS algorithm, which means that each node participant can also obtain network rewards while pledging assets to become a validator.
Funding threshold: 32 Ethereum
According to Glassnode data, although the number of addresses holding at least 32 Ethereum has exceeded 120,000, which once hit a record high, the total number of independent addresses with Ethereum has exceeded 100 million and the total addresses holding ETH have reached 40 million. Compared with a group, it can be seen that less than 1% of the addresses can participate in the pledge of Ethereum 2.0, and there are still thousands of Ethereum holders who are blocked from this capital access threshold.
liquidity risk
liquidity risk
Secondly, for the pledgers, the more than 120,000 RMB in their hands will face an unpredictable lock-up period, because the verifiers can transfer money until the first phase of Ethereum 2.0, and only after the second phase Transferring part of the funds to designated shards, this series of development processes may take up to one to two years. Due to the ever-changing development of the encryption market, Ethereum, which has been locked for a long time, is likely to face a series of unpredictable risks such as currency price fluctuations.
Slash risk
Because PoS has a built-in mechanism of "Hard Slashing", the purpose of this mechanism is to ensure the security of the network and prevent malicious actions, which means that in the case of double-signed blocks or extended validator downtime, customers will face the highest Risk of Slash (node slashing) up to 5% of funds lost.
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In order to break the above barriers, on the whole, there are two main ways to participate in Ethereum 2.0 staking: self-built nodes and staking service providers to simplify participation.
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Staking service provider
For ordinary currency holders, the more time-saving, labor-saving and worry-free way is to hand over to third-party solutions. At present, there are many staking service providers including exchanges, lending platforms, pledge pools, etc. .
According to information from beaconcha.in, most staking service providers are still in the initial stage of development, and the public plans and information are not very complete. Although some service providers have used "crowdfunding" to solve the problem of the initial investment amount, but At the same time, there are problems of high service fees and centralized trust. At present, the existing pledge pool with high availability, low cost and relatively mature is Stkr.
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Stkr is a decentralized pledge agreement platform launched by the veteran project Ankr. According to its white paper, Stkr is a PoS-based decentralized infrastructure dedicated to creating a global computing power and storage market. Ensure that resources can be fully allocated and utilized, and invested in the tasks that need to be performed (such as: processing power, storage and bandwidth), which will initially be used for Ethereum 2.0 pledges.
funds
funds
First of all, although Ankr did not directly reduce the cost to 0 for solving the initial investment amount like some schemes, due to the introduction of Micropool (Micropool), the threshold for supporting user pledges has also been lowered to 0.5 ETH. For ordinary users It is also within an acceptable range, and the proceeds will be distributed in proportion.
Specifically, Micropool is an automatic allocation system, with a minimum of 0.5 ETH pledged, nodes are decoupled from the pledge, and then allocated to a node pool of 32 ETH operated by the provider. The protocol will automatically allocate these ethers to available nodes and add unallocated ethers (in case there are more ethers than available nodes) to the queue.
In addition, for large holders who hold more than 32 Ethereum, they can also enjoy a simpler and more efficient pledge. Holders can pledge all tokens at one time without assigning them to multiple nodes. At the same time, users will The amount is rewarded with aETH (Ankr Ethereum) tokens.
node
node
Ankr itself is a Web3 blockchain cloud infrastructure platform that provides node services for individuals, enterprises, and developers. It also provides one-click API solutions for public blockchains and DeFi protocols, currently supporting more than 50 protocols , deploying thousands of nodes, for example, integrated protocols including Binance Smart Chain testnet validator nodes can be deployed on the Ankr platform.
For some users who want to be hands-on, they can also build their own node server through the Ankr platform, and store their own Ethereum in the built node. At the same time, they can also use the additional technical support of the platform to enjoy the treatment of software and hardware services .
Slash
If you don't want to rent any hardware, or don't have the technical knowledge to set up a node, you can also use Ankr to deploy an Ethereum 2.0 node with one click.
Providers are required to submit insurance funds (in the form of ETH or Ankr tokens) before allocating stakers' Ethereum on the Ankr platform to the provider's nodes. During the distribution process, nodes with higher Ankr deposits will have priority. At the same time, as a reward for their services, providers will receive 12% of the total rewards generated by their nodes, paid in ETH and ANKR.
If there is a problem with the service of a hosting node, the pledged funds will be transferred to another node, and the compensation will be paid automatically from the insurance fund paid by the provider. This means that users do not need to bear the risk of Slash due to poor hardware performance or server failure.
If the insurance funds are exhausted, the node will automatically fail, the deposit will be automatically transferred to another node with high reputation, and users can still get continuous services and rewards.
fluidity
fluidity
As mentioned earlier in the article, due to the lock-up restrictions caused by the development of Ethereum 2.0, assets will be deprived of liquidity for a long period of time. To solve this problem, Ankr introduced aETH.
Users will receive the same amount of aETH when they start staking Ethereum. aETH is a token that can be acquired and traded immediately after staking, without waiting for the launch of Ethereum 2.0, and is directly linked to the amount of pledged ETH and the final reward. Liquidity is obtained through this method of staking tokens plus synthetic tokens.
aETH can be further converted into ETH on Stkr, where aETH represents the original Ethereum amount plus related rewards. In terms of value, since aETH includes expectations for future rewards, the value of 1 aETH will be greater than 1 ETH.
On the other hand, the project side provided a deposit incentive. To encourage users to use Stkr, an airdrop of 1,000 ANKR tokens was distributed for each ETH deposited before November 16, and the official is still preparing for future incentives.
Safety
Safety
In order to solve the problem of centralized trust, the Ethereum pledged by Ankr users will be stored in the contract, and the withdrawal authority is controlled by the contract (aETH contract address: 0xe95a203b1a91a908f9b9ce46459d101078c2c3cb).
Ankr plans to further alleviate the problems that may be caused by centralization through the governance scheme of the decentralized community.
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summary
summary
With the launch of the beacon chain, the prelude to Ethereum 2.0 was officially kicked off. With the gradual launch of the system and the improvement of application functions, players from various parties including mining pools, service providers, project parties, institutions, users, etc. will come in droves in the future .
Investors who are willing to participate can choose different solutions such as pledgers and node builders that are suitable for their own actual situation after understanding the barriers, processes and possible risks of pledge.
