Ethereum 2.0: Coinbase introduces staking

Ethereum 2.0: Crypto exchange Coinbase introduces staking for eth2

Staking at Ethereum is what mining is at Bitcoin. However, this form of investment is not without risk. The crypto exchange Coinbase has now presented its plans for Ethereum 2.0.

The crypto world has been waiting longingly for the launch of Ethereum 2.0. The crypto exchange Coinbase has now revealed its plans how it wants to deal with staking and trading in the future, when two different tokens „ETH1“ and „ETH2“ exist. In a blog post Coinbase clarifies that it will offer a Bitcoin Machine platform conversion services from „ETH1“ to „ETH2“. Those who decide to stack their tokens will receive a Staking Reward as usual. Unlike the already existing Ethereum network, Eth2 is not a proof-of-work but a proof-of-stake based block chain network. The already established Ethereum block chain will always run in parallel with the new proof-of-stake based „beacon chain“.

While ETH2 tokens will remain in the chain, Coinbase will also enable trading between ETH2, ETH and all other supported currencies and provide liquidity to our customers. We are very excited about this important milestone for ETH2 and the potential that a final rollout of ETH2 has for the entire crypto community.

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The blog does not specify an exact date. It says that the necessary legal steps should be completed by early 2021. By upgrading to phase zero of its version 2.0, Ethereum will establish its new proof-of-stake network. Ethereum’s development team claims that the proof-of-stake reduces centralisation risks and is also more secure, for example with regard to 51 per cent attacks.

The reason for this is that ETH-Stakers play a central role in the Beacon Chain. They are rewarded for securing the network and for constant validation. Basically, anyone can become an ETH Staker. However, to do so, it is necessary to deposit 32 ETH on the Beacon Chain or participate in a staking pool. A random generator is then used to select from the approved certifiers.

Last week the start of phase 0 of Eth2 was announced. As of today, 878,561 ETH have already been deposited on the Beacon Chain, which is proof of the popularity of staking. There is only one catch: the stakers will only be able to transfer their share after the introduction of phase 1. How long this will take is currently completely open. Several companies, including Darma Capital, plan to offer art staking as a service. This would also allow users to access their capital earlier.