Coinbase Finally Opens ETH 2.0 Staking Rewards Waitlist

Coinbase finally opens ETH 2.0 staking rewards waitlist and it offers a 7.5% APR in rewards so the users can sign up to be the first in line once the exchange starts offering them so let’s read more in our latest Coinbase news.

Other exchanges already started offering ETH 2.0 staking rewards but before Ethereum 2.0 went live in the past two months, Coinbase promised that it will support the network. Today, Coinbase finally opens the waitlist so the exchange users that are interested in locking down a portion of their holdings can sign up and earn 7.5% APR on their staked coins. Rhea Kaw, the senior product manager for retail at Coinbase said:

 “By joining the waitlist today, customers will be first in line to earn ETH2 staking rewards. The ability to earn rewards, simply by holding cryptocurrencies, is made possible only with crypto-based financial services.”

Ethereum is moving from a proof of work blockchain to a proof of stake network so 2.0 will be able to handle many more transactions and by doing so, the blockchain will limit the congestion and will keep the gas prices checked. That’s extremely important as most DeFi apps are built on top of Ethereum and rely on transactions that are getting through fast and seamlessly. Though it’s still not operational, it benefits from gathering more validators which are the PoS equivalent of miners that process transactions and create new blocks.

ETH2 staking rewards are coming soon to Coinbase. Learn how you may be able to put your Ethereum to work and earn up to 7.5% APR. Join the waitlist: https://t.co/ho0WBzubHj pic.twitter.com/86zhqGHvOT

— Coinbase (@coinbase) February 16, 2021

To become a validator, you need 32 ETH but the exchanges are already sitting on a pile of currency that they can pool and stake. By staking on this exchange, in particular, you are cutting off a step of staking and you let Coinbase take responsibility and risks of validating. Jamie Pitts who is  a member of the Fellowship of Etheruem Magicians said:

“This is an IOU product generated by the exchange, not a natively tradable asset.”

Coinbase indicated that it will start allowing people to trade staked ETH but the main downside was that you won’t be able to touch ETH that is locked up. There’s also another thing. As more ETH gets deposited into a contract, the maximum reward distributed of the validators decreases. The current amount in the contract is above 3 million which caps about 10% so if that goes up to 8 million ETH, the rewards will drop to 5.88%.

The exchange already offers staking rewards for Tezos and Cosmos while Kraken already started offering ETH 2.0 staking rewards.