A Guide to The Top 5 Ethereum 2.0 (ETH 2.0) Staking Pools

Handy Tips / 03.03.2021

After years of waiting, Ethereum 2.0 phase 0 is finally here. The Beacon Chain is already up and running and is running along smoothly. The launch of Phase 0 is the first step of many that will see Ethereum transition from Proof of Work to Proof of Stake consensus. Consequently, it means miners will be replaced by validators who help secure the network’s security and decentralization and gain ETH (somewhat) passively. The successful launch of phase 0 of Ethereum 2.0 marks the first step towards a more scalable, efficient, and secure network. 

Ethereum 2.0 allows users to stake ETH and become network validators. However, staking on Ethereum is unique since every validator requires 32 ETH and the need to run and manage dedicated software 24/7. Substantial rewards can be made while staking ETH, but the responsibility is also coupled with penalties and slashing (complete removal from the network) in the most severe cases. 

Ethereum 2.0 staking is quite daunting as stakers need to meet some hefty basic requirements. Not everyone can afford a minimum staking threshold of 32 ETH or can operate a technical staking setup. Staking pools come in handy to alleviate the technical and financial barriers of staking on Ethereum 2.0; therefore, allowing anyone to participate on the network through staking. Here we look at the best 5 Ethereum 2.0 staking pools.  

Ethereum Staking Pools Explained 

Staking pools essentially allow users to pool their ETH until they collectively reach the minimum threshold required to run a node and then share the staking rewards proportionally. They allow users to let you stake less than 32 ETH and collect rewards as they stream in. 

Staking pools can either be centralized or decentralized. Decentralized being the most secure, but unfortunately the most difficult to build from a technological perspective. Most staking pools today are centralized, meaning that the operators control the users’ funds and thus can affect its user’s rewards/penalties. 

The 5 Best Ethereum 2.0 Staking Pools

Blox Staking

Features 

  • Decentralized
  • Open-source
  • Minimum Staking Amount: TBD
  • Staking Fee: TBD

Blox Staking has developed the world’s first genuinely non-custodial staking platform, and that is why we are excited for the imminent release of their staking pools. Blox has received a grant from the Ethereum Foundation (EF) in conjunction with other industry leaders from Bison Trails and the EF to develop Secret Shared Validators (SSVs), which will form the basis of the pools.

SSV is a way to split an Eth2 validator key amongst several parties so that a certain threshold of the parts is needed for signing. This will enable truly decentralized pools without trusting a single custodial company or operator in a staking network. 

Pros: fully decentralized, based on SSV community project with the EF.

Cons: Not currently available, expected Q3 2021. 

MyCointainer

Features 

  • Centralized
  • Open-source 
  • Minimum Staking Amount: Any
  • Fee: 2.27% of staking rewards 

MyCointainer entered the market in 2018 as a staking wallet option for PoS networks. This shared Masternode service supports over 100+ PoS assets, including Polkadot, Ethereum 2.0, Cardano, and NEM. MyCointainer is an all-around staking platform supporting multiple asset staking. Currently, the annual reward rate for staking ETH is 15%. 

There is no minimum ETH staking amount to stake with MyCointainer; thus, you can start earning with the lowest amount of ETH you have. MyCointainer features a subscription-based service for stakers to avoid a fee based on a monthly subscription. 

The platform also includes an exchange to convert ERC-20 and PoS assets easily. The developers behind this platform focused on making an easy way to participate in the Ethereum 2.0 network. Additionally, there is an information section where you can find critical data on PoS tokens. MyCointainer continues to see rising popularity due to its helpful interface and popular giveaways. The network continually hosts cross-promotions and airdrops to increase your chances to earn. 

Pros–  Regulated, user-friendly, automated staking, direct interest in staking rewards.

Cons– Custodial, Mandatory KYC/AML for FIAT transactions.

StakeWise Pool

Features

  • Centralized
  • Not Open-source 
  • Minimum Staking Amount: Any
  • Staking Fee: 10% 

StakeWise Pool is another web-based Eth2 staking pool with plenty of features and configurations. The platform offers both custodial pools as well as semi-custodial private staking pools. It features an intuitive, comprehensive monitoring dashboard that allows stakers to track their staked ETH performance seamlessly. 

By minting deposit tokens and rewards tokens for each ETH deposit and the staking rewards, StakeWise allows users to transfer rewards earned from staking. This enables users to transfer or exchange their stake in phase 0 of Eth2. 

Pros – no minimum deposit, user-friendly UI, allows for integration with smart contracts and APIs.

Cons – Custodial.

Rocket Pool

Features 

  • Semi Centralized
  • Not Open Source 
  • Minimum Staking Amount: 0.01 ETH 
  • Fee – Not Indicated 

Rocket Pool has been developing staking services since 2016. This staking network wants to make staking on Ethereum 2.0 more accessible, convenient and aim for decentralization. The platform encompasses Stakers and Node Operators, allowing users to stake almost any amount of ETH. Stakers deposit ETH, which is assigned to Node Operators for staking. Stakers are then offered rETH after depositing to represent the amount staked and the staking rewards generated. 

Node Operators need to stake a minimum of 16 ETH to coordinate network activity by running Rocket Pool node software. On the platform, a single node operator’s validator is made up of 32 ETH – 16 ETH from a Node Operator and 16 ETH from pooled Stakers. 

Pros-Very low minimum staking deposit, user-friendly.

Cons– Semi Centralized – Stakers rely on Node Operator performance.

Binance

Features 

  • Centralized
  • Not Open-source 
  • Minimum Staking Amount:  0.1 ETH
  • Fee: Not Stated 

Binance, the world’s largest custodial cryptocurrency exchange by volume, has evolved to incorporate custodial staking for several different blockchains, including Eth2. The exchange started supporting the staking of Ethereum 2.0 tokens on December 3rd, 2020, and promises safe and secure staking with up to 20% APY. 

You can stake a minimum of 0.1ETH with just a few clicks. Binance tokenizes BETH as the only proof of your staked ETH in a 1:1 ratio. On-chain rewards will be distributed daily in the form of BETH to users’ Spot accounts.    

Pros– Easy to use, Daily rewards. 

Cons: Centralized.

Conclusion

Staking pools offer a hassle-free means of participating in Ethereum 2.0 by staking and earning ETH rewards to keep the network running securely. Despite the lucrative rewards, staking comes with certain risks, including losing ETH for going offline, malicious actions, or failing to validate. Staking pools alleviate the financial and technical bottlenecks of staking on Ethereum 2.0 and help lower staking risk. 

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Wayne is a Blockchain enthusiast and expert in crypto trading. Currently, he covers trendy issues on digital currencies.