Staking just became simpler and affordable with the launch of Rocket Pool Eth2 staking services. Now, the node operators can run a mini pool using only 16 ETH and stakers can put their crypto at work with as low as 0.01 ETH. The platform hit its stage two cap within 45 sec of its launch.
The blockchain and crypto industry have evolved from using Proof of Work (POW) to Proof of stake (POW) concept. This has posed a new set of challenges. A solo staker requires the minimum required cryptocurrency, technological know-how, and the staking infrastructure to successfully earn money from staking. Currently, there are a lot of centralized staking service providers like Kraken, Binance, Huobi etc which provide the infrastructure. However, stakers are still required to lock up a minimum amount of tokens for a stipulated time period. During this period stakers can not mitigate their losses in times of market crashes, causing liquidity issues. Stakers need to give the custody of their cryptocurrencies while staking.
The Rocket Pool launch
The recent launch of Ethereum 2.0 staking service Rocket Pool has sent shockwaves in the staking industry. The protocol aims to become the “primary staking infrastructure for Ethereum, by providing a decentralized, easy to use staking network for individuals and businesses”. The rollout is supposed to happen in four different stages within the next two weeks, each with an incremental number of deposit pool and mini pool limit.
The first and the second stages have quickly maxed out within minutes of their launch. The third stage was set to roll out on 15 Nov. However, there has been no coordination about the same on Rocket Pool’s website or twitter handle. The platform has registered 374 node operators across 42 global locations and a total of 3040 ETH has been staked so far. For the fourth stage to successfully complete, the platform requires 5000 ETH in their deposit pool limit, while the mini pool is unlimited .
The platform had also run into a few delays in their launch after a vulnerability was discovered by a rival. Entrepreneurially, the platform had started a bug bounty program to find bugs in their code. A rival, Dmitri Tsumak, founder of Stakewise took to twitter to inform about the vulnerability. A long-term fix was developed in parallel and deployed.
What has changed?
Traditional centralized services such as Binance and Coinbase make staking a quick and easy option for beginners. It, however, also entails handing over the custody of your private keys and reduced rewards because of commissions. In case of decentralized staking services like Rocket Pool (and Blox Staking and Stkr) no such arrangement is required.
Therefore the platform has solved liquidity and custodial problems by introducing smart contracts and a quick exchange mechanism for the withdrawals. Rocket Pool has also removed a lot of entry level barriers for ETH2 stakers. The previous requirement to run a node was 32 ETH but now you can do the same with 16 ETH. The rest are obtained via mini pools of equal sum. These mini pools can be used by individuals, businesses and decentralized applications without maintaining a staking infrastructure.
Rocket Pool has bridged a crucial gap for ETH2 stakers both in terms of minimum requirement and quicker rewards. Now, you can start staking your own token without worrying about the infrastructure, rewards withdrawal and commissions.