Learn 4 Ethereum Staking Strategies, and Get Your Staking Income With Confidence
Recent news about Kraken suspending staking caused mixed reactions in the crypto community. This article focuses on the basics of staking.
Four types of Staking schemes were created because of the differences in ownership of the private keys.
Its job is to verify the legitimacy of the transaction and then package the block on a chain (although the work of building blocks has been slowly outsourced to MEV service providers). Its job is to verify the legitimacy and then package the block on a chain (although the work to build blocks has been gradually outsourced to MEV service provider). Because not everyone can verify casually, After you have paid the 32ETH deposit, you will need a certificate (i.e. You will need a certificate (i.e. First, you need to create a verification key. : [withdrawal key]). Let me give you an example: this is your salary card. I believe everyone understands the purpose and ownership of these two private key: the verification key (work permit), and the cash withdrawal key (salarycard). Next, there were four staking options based on the different ownership of the private keys:CEX class
Large pool subclass (Pooled Staking).
SaaS class (Staking As a Service)
Option 1: CEX Class/full custody if the exchange staking solution is used. For example, Binance, Coinbase or Kraken (which recently announced the suspension of staking). If you have not created a [verification] key or filled in a[withdrawal] key, then this is standard “full custody.”
The Binance and Coinbase cold wallets have the withdrawal key.
Participate in verification and you won’t need to go to work. The exchange will also keep your salary card. This is the best and most secure solution. However, it is not the best choice for those who want to decentralize. Option 2: Pooled stakeThis is the staking solution offered by Lido and RocketPool. You don’t have to create two Keys. Rocket and Lido manage them. So what is the difference between an exchange and an exchange?Exchange: It operates one key under its umbrella.
Lido: Lido 1.0 has 29 professional operators. Lido entrusts each operator with the management and security of ETH. The verification key is distributed so that each operator gets a piece. It is similar to saying Lido is a group with 29 strong migrant workers. The professionals of the migrant workers can help you work, so you don’t have to do it all. The operator gets 5%, and Lido gets 5%.
RocketPool: RocketPool has many operators. Anyone with a machine/cloud service + 16 ETH can become an operator. RocketPool can be described as a crowdsourcing platform with many Meituan riders, their own electric vehicles/cloud servers, and computer rooms to support you running nodes.
They also have to pay a commission. When you withdraw: Your node notifies Beacon Chain to send a withdrawal signal. When you withdraw: Your node notifies Beacon Chain that it is sending a withdrawal signal.
After queuing up, Beacon Chain will notify Ethereum 1.0 Treasury.
The vault address for Ethereum 1.0 sends money to the address that you specify. For example, 0xABC
The so-called [withdrawal keys] is essentially the private address 0xABC. And the withdrawal key of Lido&Rocket helps you pack 3 additional layers: You inform LidoRPL I want to withdraw
LidoRPL informs the operator that a specific node wishes to withdraw cash
The operator informs BeaconChain about the desire of a specific node to withdraw cash
BeaconChain notifies Ethereum 1.0 treasury
Ethereum 1.0 vault address to LidoRPL for withdrawing money from the vault
You can destroy stETHrETH and the LidoRPL smart contracts send money to your address.
PS: If you are switching to an exchange, the seventh and final step is to add balance to your BinanceCoinbase central bank by CZArmstrong. Steps 2 and 3 are the weak links. The weak link is in steps 2 and 3. The theory is that the big pool sub-category scheme can reject your withdrawal. Lido’s liquidity is excellent (currently exceeding all other LSD-related schemes), which is a plus. Option 3: SaaS (Staking as an Service)The third step makes staking even more fundamentalist. The Ethereum network has it, which can be described as SaaS or VaaS, which is Validator as A Service. Let’s look at @ebunker_eth as a non-custodial mine pool. A professional mining pool will then manage the block generation for this node. You can also fill in your own withdrawal address. This is how we have the final withdrawal rights of Ethereum. The difference is that the Pooled category’s withdrawal address is unified (that’s, the LidoRPL vault), making it a “big pool.”
The SaaS category allows everyone to fill in their cash withdrawal address. It is therefore a “small pool.”
You may then ask, “It’s like SaaS,” but even if the mining pool doesn’t help you broadcast on Beacon Chain, can you withdraw cash in person? Because you have your verification key in your hand, you can still run this Node and broadcast in-person if the worst happens. You also have a [withdrawal] key in your hand so that you can withdraw cash in person. This is the genius of Ethereum Staking. When you create a node you will fill out your withdrawal address and the mining pool can’t alter it. Even though the mining pool may be a rug, the principal cannot be taken by the pool. The difficulty of stealing Ethereum makes it difficult to steal it. However, the mining pool can theoretically take the money after the worst happens. It simply needs to upgrade its vault contract and transfer its ownership to the attacker. It simply needs to upgrade its vault contract, transferring its ownership to the attacker. There are many mining pools that offer similar services to @ebunker_eth. You can check Rated. LSD solutions are not available for all SaaS types that are not managed. It is very simple. If you don’t have your private key, they can send you a passbook (LSD). Some SaaS mining pools may also offer large pool plans, which can be used to obtain LSD. While CEX and large pool solutions can be accepted, Solo and small pools are not acceptable. The liquidity of the SaaS-type small-pool solution has also been guaranteed to an extent. It is acceptable to give someone else the key/APR. Option 4: Solo Staking The benefits are obvious. They are safe, secure, and no one takes any commission. It also adds diversity to Ethereum and… meets the spiritual needs of the world. However, there are disadvantages. Working alone requires cost: time cost (maintenance), capital cost (renting/building a physical computer room), and cost. Your APR will be slightly lower if you don’t have 24-hour maintenance. For example, the current effective rate for block generation in the entire network at 97%. Vitalik might be a Solo miner. He is a professional, but he can only achieve a 96% rate of effectiveness. Rocket Pool’s effective rate is even lower. It is crowdsourced and the effective rate of 95% is also available. Solo requires at least 10K Ethereum to qualify. This is equivalent to more than 30 nodes in a group. It is important to consider the stability and viability of block generation (it can also be very uncomfortable to not grab MEV blocks). The income is not the same as the cost. However, if you have enough Ether (or more than 30K), you can hire some people to manage it. Paying wages is less expensive than being commissioned by large pools or small pools, and you must have more surplus. Solo is the holy grail to eternality. Solo is a good option if the number is high enough. What is SSV? SSV is a researcher in DVT technology. It is not a competitor to the four solutions above, but a partner in DVT technology research. DTV is used for splitting verification keys.
Moreover, each operator doesn’t know the entire verification key. This makes verification more decentralized and can make Solo, SaaS and Lido stronger.
We hope you find this analysis helpful in understanding the relationships, similarities and differences among all staking schemes. You are welcome to review and mark this website at any time. We encourage you to do your own research before investing.Join us to keep track of news: https://linktr.ee/coincuHaroldCoincu NewsTags: Beacon chainBinanceCoinbaseETHEthereumLidoRocketPoolSaaSstaking