Simply Staking supporting Lido ETH 2.0 Liquid Staking
At Simply Staking we are thrilled to announce that we have recently been onboarded as an Ethereum node operator to collaborate in the decentralization of the Lido Protocol.
Stated simply on the Lido platform, Lido lets you use your staked assets to gain yield on top of yield and as the name implies Liquid Staking brings about liquidity to your staked assets. Lido currently provides liquid staking for Ethereum, Terra, Solana, and more networks in the pipeline. At the time of writing, the platform, which was launched in December 2020, has over 8bn in staked assets.
Simply Staking and our Infrastructure
Simply Staking is a blockchain service provider operating out of Malta, comprising of various teams. The Simply Staking team within the group operates validators on 31 Proof of Stake networks, provides support to both startups and major Web3 players, and powers DeFi as a Chainlink oracle node operator across most EVM chains. We believe that decentralised public infrastructure requires a set of independent, geographilly distributed validators operating their own private infrastructure. To this end, the group operates infrastructure out of its own Tier 3 datacentre, with various backup sites across the globe, and a policy against the use of cloud providers. We are proud to be onboarding onto the Lido Ethereum protocol, bringing years of blockchain experience, reliability, and jurisdictional and infrastructural diversity, with the overarching goal of further decentralising and securing the existing node operator pool.
Some Context on Ethereum
You may or may not have heard that Ethereum is going through several phases of transitioning from Ethereum to Ethereum 2.0, commonly known as Eth2.0. In other words, this means that the network is moving from Proof of Work consensus mechanism to a Proof of Stake model, making Ether(ETH) an asset that is staked.
This evolving process, more than a transition, is a large undertaking and is being carried out with the aim of improving the scalability, security and sustainability of Ethereum.
The initial phase has already passed and this introduced staking to the new blockchain. Participants are able to stake their Ether and secure the new Ethereum network by contributing in validating transactions, making this an incentivized process as participants are rewarded for doing so.
Currently, the merge is in the Beacon Chain phase, which is the first phase that brings staking to the Ethereum network, whereby participants are able stake their Ether on-chain, along with the possibility to utilize select exchanges which facilitate the process to do so and have them locked until the final merge of the former and new blockchain happens, which is estimated to occur sometime in 2022.
While running a validator requires a minimum of 32 Ether, that may be out of many interested participants’ budget, however there are exchanges that offer the possibility to participate as delegators. The drawback is that these solutions limit the return due to not just the lower yields they provide but the lack of participation and flexibility of staked assets they would otherwise have with DeFi. This is solved with Liquid Staking, by means of using staked representative tokens.
More information on the Eth2 upgrade here:
The Lido Staking Solution
With liquid staking, the true potential of DeFi is unlocked, granting added flexibility and unlocking further investing opportunities with staked assets.
Lido Finance is a decentralized finance app which through its intuitive UI, one can stake their cryptocurrency on select networks. Eth2.0, Terra and Solana are currently supported, three of the largest in the space.
The platform is powered by smart contracts and to stake Eth2.0 there is no minimum amount required to participate. Participants will receive a brand new token, stETH on a 1:1 basis representing their staked ETH. This new token is a liquid form of ETH, which depending on the intentions and strategy of the participant, may be used to earn further yields and lending rewards.
It is important to note that with regards to unbonding, participants staking will not be able to withdraw their staked ETH until ETH 2.0 launches, also known as Phase 2.
The Lido ecosystem is vast and consists of several apps which are viewable on their front page which gives users options to utilize their staked assets on, the likes of Anchor Protocol, Balancer, FTX, Curve and many more.
Concluding remarks
Ultimately Lido Finance is a liquid staking solution for ETH 2.0, providing an added benefit of receiving a liquid representation of your staked ETH which you can put to work in parallel by participating in other DeFi apps while you secure the ETH 2.0 network.
With the use of smart contracts, the use cases will only increase and consolidate over time, doing so enhancing the efficacy of delegated assets and the potential of earning higher returns.
DeFi adoption is rampant, solutions are constantly being superseded by newer ones and this is why we are thrilled to have become a node operator on Lido as it is a fantastic project that is leveraging the latest solutions for staked assets through its growing platform.
Stay tuned to Simply Staking for more ETH2.0 related guides and documentation:
- Website: https://simply-vc.com.mt
- Twitter: https://twitter.com/SimplyStaking
- Discord: https://discord.gg/Kpzc58Gu9a
- Telegram: https://t.me/SimplyVC
