Binance US

Binance US moots an efficient ether staking service in advance of ethereum’s “MERGE” event

Binance US
BINANCE

 

Binance US, the world’s largest cryptocurrency exchange’s US-based subsidiary, is now offering Ethereum staking with an annual percentage yield (APY) of 6% — a figure that is a significant step above major competitors like Lido and Coinbase, which offer 3.5 percent and 3.25 percent APY, respectively. Binance US said in an announcement that customers will be able to stake ETH on the platform for a competitively low minimum of 0.001 ETH. A user would otherwise have to put up a minimum of 32 ETH to stake ETH directly over the Ethereum network.

“As the Ethereum network continues to migrate towards The Merge,” Binance US CEO Brian Shroder stated in a news statement.

According to StakingRewards data, the number of people staking ETH increased by 54,800 over the previous month. However, average ETH staking revenue fell from a high of $1.68 billion (approximately Rs. 13,400 crore) on August 13 to $937 million (about Rs. 7,500 crore) at the time of writing. The drop was mostly due to ETH’s price drop from above $2,000 (approximately Rs. 1,60,000) in mid-August.

 

The term “Merge” alludes to Ethereum’s long-awaited update, which will integrate the network’s consensus layer, known as the beacon chain, with its execution layer, which is now the Ethereum mainnet. The Merge will complete Ethereum’s shift from a proof-of-work to a proof-of-stake consensus mechanism.

The Merge is now scheduled to take place between September 13 and September 15. Following that, Ethereum users will be able to stake their ETH to help safeguard the network while also collecting passive ETH payouts.

Users will be able to withdraw their staked ETH from the Ethereum network following another update known as the “Shanghai Upgrade,” which is contingent on the Merge upgrade being completed.

However, due to the complexity of the planned Merge update, there is no assurance of a seamless transition, and users’ funds are vulnerable to risks such as delayed return on investment or loss of assets if the upgrade fails.

Binance US is the most recent major cryptocurrency exchange to accept Ethereum investments.

On Wednesday, the business announced that its customers may now stake the second largest cryptocurrency by market capitalization and receive rewards at a rate of 6% in APY.

It’s a significant improvement over other big rivals like Lido and Coinbase, who presently provide 3.5 percent and 3.25 percent APY on ETH staked, respectively. Platforms for lending cryptocurrency, such as BlockFi and Nexo, provide just 4% and 5% APR on ETH investments, respectively, but they operate on an exceptionally high-risk, successful business model with huge profits.

According to Binance US, stake payments might vary based on Ethereum transaction costs and other factors.

“As the Ethereum network moves closer to The Merge, we are excited to now provide ETH staking with some of the highest APY payouts in the market,” Binance US CEO Brian Shroder said in a news statement.

The term “merge” or “merge” refers to Ethereum’s long-awaited update, which will connect the network’s consensus layer, known as “the beacon chain,” and its execution layer, which is now the Ethereum mainnet. This merger will complete Ethereum’s transition from a proof-of-work consensus method to a proof-of-stake system.

The merger is expected to take place between September 13 and. Following that, Ethereum users will be able to stake their ETH to secure the network and receive an ETH payout as a consequence.

According to the most recent beacon chain statistics, the Amber Group, a crypto financial services organization, has projected that the payouts for validators can vary between 8 and 12 percent in APY. However, there is a catch.

To join the platform as a single staker, you must contribute at least 32 Eth. At the present pricing, it is roughly $50,000 for regular users.

In this sense, gamers are increasingly opting to centralized staking services, also known as staking pools instead. Despite the fact that these platforms impose fees that limit stakeholder revenue, they dramatically cut the cost of access. As an example, consider Binance US. It just takes 0.001 Ethereum to get started, which is around $1.50 at current pricing.

However, it has prompted concerns about the risk of centralization of the Ethereum network and how this would affect its capacity to survive censorship in the event that US officials aggressively target cryptocurrencies.

 

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By Ayomide

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