Things You Should Know Before Staking on Ethereum 2.0

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The Ethereum 2.0 upgrade was recently implemented on an official test network. Since then, developers have caught mission-critical errors in code.

Paul Hauner, lead developer of the Ethereum 2.0 Lighthouse client, used the following statements:

“This is the biggest testnet launch Ethereum 2.0 has ever seen. Thanks to this launch, we learned what was annoying to people. We found some bugs. We are currently troubleshooting a very interesting and elusive bug that could cause nodes to crash. ”

There are also testing the new Eth 2.0 fake network called “Medalla” and some surprises along the way. In the mind of Staked’s co-founder and CEO Tim Ogilvie, all the bugs and unexpected issues in the Medalla network so far are relatively minor and cause no concern.

Ogilvie uses the following statements on the subject:

“We run 25 different proof of stake networks, so we are used to working on test networks. We see a lot of the same issues in test networks, which is sometimes when software isn’t communicating perfectly or when the network needs to be restarted. I think Eth 2.0 is doing pretty well compared to most of the other test networks we’ve seen. ”

Caution Should Be Taken About Staking

However, both Hauner and Ogilvie agree that there are important features about the Eth 2.0 network that users need to understand before staking their ETH.

According to Ogilvie, “what really matters” is the fact that ETH cannot be transferred back to the original Ethereum blockchain once it is transferred to the Eth 2.0 network. Ogilvie says:

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“Until the next phase of Ethereum 2.0 development is enabled, it will be a one-way journey. Your money is not liquid. The only thing you can really do is participate in staking. People should understand this before they start. ”

What is Staking?

Most commonly, users are rewarded for depositing and holding a token at an exchange for a period of time. In return for this action, the user is offered a monthly return calculated according to the proportional share of the total balance held in the exchange, which constitutes the staking rewards for a certain month.

Staking has been developed as an alternative to the Proof of Work (PoW) model used by cryptocurrencies such as Bitcoin, as the ever-increasing energy consumption required for mining poses a problem for network scaling. Proof of Stake (PoS) is recognized as an alternative, energy efficient way to achieve distributed consensus that will allow for a much larger network scaling.


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