ConsenSys has announced its new staking pilot program for the Ethereum blockchain.
This is a SaaS (Staking as a Service) solution for which the company provides the necessary to become an Ethereum 2.0 validator.
This way ConsenSys, through Codefi, will launch a pilot program with several exchanges like Binance, Crypto.com, DARMA Capital, Huobi Wallet, Matrixport, and Trustology to test the system and obtain more feedback.
Codefi‘s goal is to build a high-quality product that can then be used and sold as if it were white-labelled and thus speed up the process of spreading the staking to all those who will use their APIs and services.
It should be remembered that the launch of Ethereum 2.0 is expected within the year, resulting in the transition from PoW (Proof of Work) to PoS (Proof of Stake) and also the implementation of the famous sharding, which is already operational for example on Zilliqa. More fluidity is foreseen with the update, allowing to scale the number of transactions by at least 100 times.
From what is known, at least 32 ETH have to be staked to become a validator, besides the need to have all the necessary technology to manage the node. A minimum of 16 thousand validators and more than half a million ETH have to be staked to be able to actually launch Ethereum 2.0.
There is always a risk to start a node and, to avoid mistakes, this solution could be the winning one to adopt. This is the comment of Tim Lowe, Product Lead at Codefi Staking:
“Some of the risks associated with running your own validator include theft or loss of withdrawal keys, incorrect transfer of funds to the Eth 2 deposit contract, and not to mention hardware or internet connectivity failures which result in a loss of validator rewards. With ConsenSys Codefi, validator keys are held in a secure vault with online signing capability, and there will be multiple layers of gatekeepers validating transactions preventing unauthorized usage. We know the importance of onboarding as many validators to Ethereum 2.0, and for that reason have built a turnkey solution for enabling large exchanges and institutional crypto funds to have an always-on and dependable access point to stake the ETH they hold for their customers”.
In fact, relying on such a solution allows exchanges to provide a broader spectrum of staking, as they could provide a lower level of entry than the 32 ETH threshold, as highlighted by the CEO of Binance, Changpeng Zhao:
“With staking on Binance, users can receive staking rewards without needing to set up nodes, or worrying about minimum staking amounts, time lengths, or any catches. Users deserve the rewards that their coins can earn them. With the eventual launch of Ethereum 2.0, we are excited to support staking for all of our ETH holders on Binance”.
With regard to the technical aspect, the Codefi Staking solution has been developed on PegaSys Teku, a client dedicated to the business world, while it is interesting to note that there is also a section for early adopters and therefore for those who want to use this type of service in advance.