As the launch date of Ethereum 2.0 approaches, an important issue in the staking mechanism is starting to be discussed in the community: the one-way nature of stake deposits.
Prospective stakers in Ethereum 2.0 Phase 0 will not be able to withdraw or transfer their stake until after the rollout of Phase 1, which could take years.
Through its LiquidStake initiative, both retail and institutional stakers can delegate their capital and maintain the ability to use it as collateral to receive USD Coin loans.
Unlike other staking derivative proposals, LiquidStake will not create new tokens to represent the bonded Ether.
"With LiquidStake you can have your stake and eat it too," added Andrew Keys, co-founder of Darma Capital.
The company partnered with staking providers including Bison Trails, ConsenSys Codefi and Figment to handle the actual validation process, while OpenLaw and Lukka helped with the legal and tax management of the system.
There are no minimum staking amounts, and the lending system works through the familiar mechanism of margin calls and liquidation - at least on paper, as the ETH cannot be moved.
A notable caveat is that prospective customers must go through LiquidStake to join Ethereum 2.0, or otherwise, they will become ineligible for the lending service.
Slazas said that LiquidStake simultaneously solves another major issue: the tax implications of Ethereum staking.
Though Darma will make money out of this arrangement by charging interest and a "Performance fee" on the staking yield, Keys said that "We are here to help in the decentralization and growth of Ethereum 2.0.".
LiquidStake set to unlock liquidity for Ethereum 2.0 Phase 0 stakers
gepubliceerd op Nov 11, 2020
by Cointele | gepubliceerd op Coinage
Coinage
Vermeld in dit artikel
Recent nieuws
Alles zien
Blockchain Bites: Bitcoin's Run, Uniswap's Hemorrhaging Value, Anchorage's Banking Bid
Bitcoin is nearing all-time highs in price and market cap last set three years ago.
Japan's megabanks to lead experiment with digital yen
We have, in order, Cheese Bank with a $3.3 million theft, Akropolis with its $2 million loss, Value DeFi with a whopping $6 million exploit and finally Origin Protocol's loss of $7 million.
Number of new Bitcoin addresses spikes amid growing FOMO
Japan's three largest banks, as part of a group of 30 private sector actors, are set to collaborate on an experiment with a digital yen.
Not just Wall Street: Quant trader explains why Bitcoin price is going up
Sam Trabucco, a quantitative trader at Alameda Research, believes four general factors are pushing up the price of Bitcoin.