MetaMask Introduces New Ethereum Staking Service with 10% Validator Reward Commission
Summary:
Cryptocurrency wallet provider MetaMask has introduced a new staking service that allows Ethereum users to run their own validator node for a stake of 32 Ether. The service eliminates the need for hardware or pooling. Despite these benefits, the 10% commission on validator rewards has been criticized. Currently, staking via MetaMask offers a yearly yield of 3.8%, and the company has managed over $2 billion in ETH across more than 33,000 validators without any slashing penalties in its two-year operation.
MetaMask, a robust provider of cryptocurrency wallets, has recently launched a staking service allowing Ethereum users to operate their own validator nodes, if they're willing to pay the price. The announcement made on 18th January detailed that MetaMask's Portfolio will put the validator node in operation for those willing to stake 32 Ether (ETH), currently valued at approximately $78,752.
The service doesn't necessitate pooling or any hardware, as MetaMask guarantees secure node operation, streamlining staking rewards and mitigating slashing and downtime risks. The offer might appeal to novices or those seeking decentralization, given that staking through MetaMask could address centralization worries posed by sizeable liquid staking providers like Lido.
MetaMask's service obviates the need for clients to buy hardware to operate a personal Ethereum node and virtually eliminates the slashing risk during internet disconnects. MetaMask's manager, Consensys, claimed it had not incurred any slashing penalties whilst managing over $2 billion in ETH across over 33,000 validators in their two-year operating history.
The staking returns from MetaMask currently stand at 3.8% annually; however, the platform claims a 10% commission from the validator rewards. The Founder of crypto portfolio tracker Rotkiapp, Lefteris Karapetsas, remarked on the announcement as an "Interesting idea," but the 10% fee could entirely discourage users comparing other available options.
Staking with MetaMask, deductions considered, offers similar yields to what Lido offers at 3.4%. Lido maintains a market-leading position as a liquid staking platform with roughly 9.3 million ETH (valued at $22.9 billion) currently staked, amounting to near 40% of the total 28.8 million ETH staked as per Ultrasound.Money. It is also worthy of mention that approximately a quarter of Ethereum's total circulating supply is invested in staking.
Besides decentralized staking providers, Ethereum holders may also resort to centralized exchanges such as Coinbase, which levies a colossal 25% deduction on staking rewards.
Published At
1/19/2024 7:35:07 AM
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