Ethereum 2.0 Phase 0 is coming soon, a highly anticipated moment for the crypto community, as the blockchain built to serve all of humanity begins its transition to Serenity, and Proof of Stake consensus. There are 16,384 validators and 524,288 ETH needed to start securing the network, and the deposit contract has now been deployed. Its a monumental time for believers in Ethereum, and the perfect time to join the community, start staking, and generate ETH rewards in return.
What is Ethereum and Eth2 Staking?
Ethereum is not just a cryptocurrency, it’s the world’s programmable blockchain. Founder Vitalik Buterin proposed Ethereum back in 2013 with the intention of creating a blockchain with executable smart contracts, that allow for programmability of decentralized applications, games, financial services and any other decentralized app you can imagine.
So what’s wrong with Ethereum in its current state?
Currently, Ethereum is a Proof of Work based blockchain, where miners compete against each other to execute transactions and add blocks on the chain. In its current form, Ethereum can only execute ±15 transactions per second, has many centralized forces profiting as miners (as running a node becomes increasingly difficult the larger the network becomes), and wastes an exorbitant amount of electrical energy.
Hurts the Earth
The solution? Staking on the Eth2 Beacon Chain
To solve these challenges, and ultimately allow the network to efficiently scale in a decentralized way, the Eth2 upgrade allows any ETH holder to secure the network by becoming a validator staking on Ethereum and earning rewards in return. The requirements for ETH staking are 32 ETH and the right technical infrastructure (Validator Client, Eth1 node, Beacon Chain node. All can be run on a consumer laptop or equivalent) to propose and attest emerging blocks on the Proof of Stake based Beacon Chain.
Why Should YOU Stake (even if you don’t have 32 ETH)
In principle, participating in Ethereum 2.0 staking promotes a decentralized future by supporting a project that is as transparent as it is accessible. In practice, there is an added benefit to Eth2 staking – earning ETH rewards.
A validator’s total staked ETH staked increases with every correctly performed duty assigned to it by the blockchain. As more and more people join the network, and Eth1 eventually joins Eth2 (in approximately 2 years), staking rewards will decrease. Early adopters are hence rewarded with higher returns for their early participation.
But what do I do if I don’t have enough ETH, or I just don’t feel like dealing with the technical aspects of staking?
If you don’t have the minimum amount (32 ETH) needed to stake, pooled staking services have been designed that allow you to contribute any amount of ETH and receive rewards (stay tuned for Decentralized Staking Pools). If you want to make the staking process as passive as possible, similarly, there are staking platforms available that reduce the technical barriers to entry.
No matter the staking configuration, the time is now to stark staking and contribute to the Ethereum ecosystem. The rewards are highest, the community’s role has never been more important, and an inclusive, decentralized future has never been more close than it is right now.