MetaMask Wallet recently launched a new “Validator Staking” service specifically for users who hold 32 or more Ether coins. However, MetaMask charges a high fee of up to 10% on the rewards earned by validators, which may affect its competitiveness.
Table of Contents:
What problem does it solve?
What are the weaknesses?
Tutorial for staking
Since the Ethereum network’s transition to Proof of Stake (POS) in September 2022, the amount of Ether coins staked has exceeded 28.86 million, accounting for approximately 24% of the total supply. Various staking methods have emerged in the market, including individual staking (solo-staking), staking through liquidity protocols (such as Lido), or centralized exchanges (such as Coinbase).
Yesterday (18th), MetaMask, the mainstream Ethereum wallet, announced the launch of the “Validator Staking” service in its MetaMask Portfolio. This is another new initiative following the direct staking of Lido and Rocket Pool in the MetaMask Portfolio in January last year.
The “Validator Staking” service mainly targets users who hold 32 or more Ether coins, and it is designed to assist users in running nodes securely, simplify the staking process, improve the convenience of earning rewards, and reduce the risks of slashing and downtime, with the assistance of Consensys, the developer of MetaMask, through its Stake service.
For users pursuing decentralization and beginners, this new service is particularly attractive because staking through MetaMask can solve the centralization issues of large liquidity providers such as Lido. According to official data from Lido, the proportion of Ether coins staked through its platform has exceeded 32%.
Furthermore, this service eliminates the need for users to purchase and set up hardware and software to run personal Ethereum nodes, and reduces the risk of slashing due to network interruptions.
Consensys proudly states its past performance in providing staking services:
Although this newly launched MetaMask Validator Staking service offers a convenient and somewhat attractive option, the platform charges a fee of up to 10% on the rewards earned by validators.
Note: Coinbase charges up to 25% for Ethereum staking rewards.
In response, Lefteris Karapetsas, the founder of the cryptocurrency portfolio tracker Rotkiapp, stated:
Currently, the annual yield of staking through MetaMask for validators is 4%. However, considering the impact of fees, the annual yield is equivalent to the 3.4% yield provided by Lido.
You can stake through MetaMask Portfolio by following these steps:
Connect your MetaMask wallet to MetaMask Portfolio.
Click on the “Staking” tab in the left sidebar and navigate to “Validator Staking” at the top of the page.
Choose the account address.
Enter the amount of ETH to stake using the slider (note: deposits can only be made in multiples of 32, which is the required amount for a validator).
Review the staking summary, staking rewards, and activation time (note: MetaMask charges a 10% fee from the rewards earned).
After review, select “Confirm” and sign the transaction in your wallet to approve and submit the staking deposit.
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