Telecom giant Deutsche Telekom, the parent company of T-Mobile, announced on Thursday the launch of its Ethereum staking services.
The German company stated that its T-Systems Multimedia Solutions (MMS) division is working with a liquid Ethereum 2.0 staking service and DAO StakeWise to operate a staking pool that allows customers to participate in validating transactions without having to run a validator themselves. Deutsche Telekom is also participating in the governance of the StakeWise decentral autonomous organization (DAO).
In a statement, the Head of Blockchain Solutions Center at T-Systems MMS, Dirk Röder, said, “As a node operator, our entry into liquid staking and the close collaboration with a DAO is a novelty for Deutsche Telekom.”
Deutsche Telekom believes liquid staking through its new service will attract customers because, like other such services such as Lido, the offering helps customers save time and the hassle of having to set up a validator node for themselves. Furthermore, liquid staking is cheaper than ordinary Ethereum staking which requires users to set up their own node and they need to stake at least 32 ETHs, which at today’s price is around $43,338 in order to participate in staking activity.
Deutsche Telekom has been actively participating in the crypto landscape for some time. Last year, the company entered into the crypto space by investing in Celo, a San Francisco-based blockchain startup that offers cryptocurrency on mobile services.
Last month, T-Mobile, a subsidiary of Deutsche Telekom, partnered with Nova Labs to launch a new 5G wireless service called Helium Mobile that aims to allow users to earn rewards in crypto tokens for sharing data.
Why Users Are Preferring Liquid Staking
Ethereum staking is the process in which users lock up their funds to help validate blocks and secure the Ethereum network. In return, they receive staking rewards in the form of more ETH. However, many limitations still hinder users from participating in the staking process. For example, investors are required to deposit a minimum of 32 ETH collateral (worth approximately $43,338) to become a validator. This is quite expensive for ordinary investors.
Liquid staking resolves such limitations as it allows users to stake any amount of Ethereum and to effectively unstake their ETH without the unnecessary requirements of transactions. As a result, Ethereum staking has been gaining more popularity as it is an alternative way in which users are locking up their stakes and earning rewards.
Late last month, Coinbase launched its liquid staking token, called Coinbase Wrapped Staked ETH (cbETH), ahead of the Ethereum blockchain’s Merge – a liquid staking service that allows users to generate extra yield on top of standard rewards for staking or locking crypto tokens in a network. Binance, Lido Finance, and Kraken are also other institutions that run major Ethereum staking pools.
Eth2 staking provider Rocket Pool has postponed its launch after a possible exploit was identified in the protocol’s code.
On Oct. 6, Rocket Pool announced the postponement while the team implements a fix for the bug. Rocket Pool tweeted that “relatively minimal” changes are required to patch the vulnerability and that a new launch date will be announced soon.
1/ Yesterday our bug bounty program helped discover an exploit that also affected other staking providers, as a result we are postponing launch to implement a fix.
We would like to extend our warmest thanks to @tsudmi for raising the exploit.
— Rocket Pool (@Rocket_Pool) October 5, 2021
Rocket Pool was alerted to the vulnerability by Dmitri Tsumak, the founder of rival staking provider StakeWise.. After Rocket Pool confirmed the bug was valid, the two teams notified another Eth2 staking project, Lido, that the vulnerability also posed a risk to its protocol as well.
Lido acknowledged the bug via Twitter on Oct. 5, proposing a vote to lower staking limits for all node operators in a bid to minimize the risk posed to the protocol. Lido described the potential impact of the exploit as “low,” adding that “the vulnerability can only be exploited by the currently whitelisted Lido node operators.”
“A long-term fix is being developed in parallel and more information will be shared when it is out of a draft stage,” the team added.
StakeWise publicly announced Tsumak’s role in identifying and reporting the possible exploit to its rivals, asserting: “Even when dealing with our competitors, the more secure we are collectively, the stronger the entire ETH2 staking ecosystem becomes.” Rocket Pool also tweeted a commitment to shared network security.
5/ At StakeWise, we believe that even when dealing with our competitors, the more secure we are collectively, the stronger the entire #ETH2 staking ecosystem becomes. To achieve this, we must communicate and watch each other’s backs.
— StakeWise (@stakewise_io) October 5, 2021
Eth2 staking services
As Ether deposited to the Eth2 staking contract cannot be withdrawn until Ethereum’s forthcoming chain merge has been completed, many investors have turned to providers offering liquid staking services. Liquid staking allows tokens representing the value of staked assets to be utilized in decentralized finance without requiring the underpinning assets to be unstaked. Eth2 staking services also enable users with less than the 32 ETH minimum, to stake in pools.
Related:Staking on Ethereum 2.0, explained
According to StakingRewards, Eth2 currently ranks as the third-largest Proof-of-Stake network with a staked capitalization of $27.3 billion despite only 6.55% of supply being locked up.
By contrast, more than 70% of the circulating supply of the two-largest networks by staked capital has been locked up, with the $60.5 billion worth Solana (SOL) and $51 billion worth of Cardano (ADA) currently staked representing 77% and 70.5% of the projects’ respective circulating supplies.
A vulnerability affecting funds in ETH 2.0 staking pools has been safely patched.
The bug was identified by StakeWise founder Dmitri Tsumak, who cooperated with rival staking protocols to protect users’ funds.
Although the exploit has been patched, the affected protocols are still working towards a more permanent fix.
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Dmitri Tsumak, the founder of the ETH 2.0 staking platform StakeWise, discovered a severe vulnerability affecting ETH staking competitors Rocket Pool and Lido. The exploit has now been patched, with Rocket Pool and Lido each paying Tsumak a $100,000 bug bounty for identifying the issue.
Ethereum Staking Pool Bug Patched
A vulnerability affecting funds in ETH 2.0 staking pools has been safely patched.
Late Monday evening, StakeWise founder Dmitri Tsumak discovered an exploit that would allow node operators to remove funds from ETH 2.0 liquid staking pools. Tsumak initially identified the exploit in the architecture of the soon-to-launch ETH staking protocol Rocket Pool. Under further investigation, the bug was also found to affect Lido, the current biggest ETH 2.0 staking pool on Ethereum, with a total value locked of $4.66 billion.
1/ Last night around 7PM UTC, our founder Dmitri Tsumak (@tsudmi) discovered a severe vulnerability in @Rocket_Pool that could lead to the theft of users’ funds if exploited.
Upon further examination, it became apparent that @LidoFinance’s architecture was also affected. https://t.co/xlpZMYkFMe
— StakeWise (@stakewise_io) October 5, 2021
Although the node operators chosen by Rocket Pool and Lido are trusted, the exploit highlights a critical vulnerability in the smart contract architecture governing the protocols. While the bug was live, around 100 ETH of users’ funds were at risk.
After Tsumak reported the bug using an alias, the Rocket Pool team quickly informed Lido that funds on its protocol were also at risk. By the following morning, both protocols had taken measures to ensure the safety of their user’s funds.
The bug was identified just 24 hours before Rocket Pool was due to go live on Ethereum mainnet; the launch has now been postponed.
Rocket Pool and Lido have implemented temporary patches to secure users’ funds, but the problem is not yet fixed completely. Both protocols have chartered a course of action and are currently working toward a more permanent solution to the exploit.
After the incident was resolved, the involved parties took to social media to debrief their respective communities on what had happened. Rocket Pool extended its gratitude to Tsumak for reporting the bug, despite being the founder of the Rocket Pool rival StakeWise.
On Twitter, StakeWise addressed why it had decided to go public with information of the exploit once it had been patched, stating:
“At StakeWise, we believe that even when dealing with our competitors, the more secure we are collectively, the stronger the entire #ETH2 staking ecosystem becomes. To achieve this, we must communicate and watch each other’s backs.”
Both Rocket Pool and Lido have agreed to pay Tsumak $100,000 for identifying the issue, the maximum amount detailed in Lido’s bug bounty program.
While vulnerabilities in DeFi protocols are not uncommon, they are often identified before hackers can exploit them. In August, Samzcsun of Paradigm.xyz detected a $350 million vulnerability in SushiSwap’s MISO smart contracts. The exploit was identified and fixed before hackers could take any funds. The Sushi team paid Samzcsun a bounty of $1 million USDC for his assistance identifying and fixing the bug.
Disclaimer: At the time of writing this feature, the author owned BTC, ETH, and several other cryptocurrencies.
This news was brought to you by ANKR, our preferred DeFi Partner.
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As the launch of the Ethereum 2.0 upgrade is coming closer, it is driving the crypto world crazier than ever. With StakeWise, staking ETH is simple and convenient, and investors are protected as their coins’ value is fully covered.
The biggest question is, how an ETH holder can stake his Ether and get them back safe and sound. In that context, StakeWise has stepped into the market, helping ETH holders to create low-risk returns. StakeWise has a solution that makes sense for staking!
StakeWise is an inclusive smart contract-based platform, which works to provide a basket of ETH 2.0 services. The platform is built on the Proof-of-Stake consensus model, allowing easy token staking and a simple reward structure.
Headquartered in Estonia, StakeWise has been undergoing the beta test for nearly seven months.
In its latest update in March 2021, the platform announced a successful fundraising campaign of $2 million USD, even before its official mainnet launch. The funds were raised in a private round fundraising event and are evidence of the interest the platform is getting from investors.
In its public statements, StakeWise clearly addressed its services, including a custodial staking pool as well as non-custodial solo-staking.
StakeWise is assembled as a DAO (Decentralized Autonomous Organization) with a governance token $SWISE. It guarantees complete transparency and gives as much voting power to participants.
A Great ETH Staking Solution
StakeWise is among the first providers to offer ETH2.0 staking solutions that are redeemable and preservable. Currently, the ETH2.0 upgrade is still taking place, meaning staked ETH cannot be exchanged back for trading until later this year when the shard chain deployment has been done.
To solve that headache, StakeWise brings in a protocol that tokenizes users’ ETH deposits into sETH2 and sends them a reward token known as rETH2. Those tokens are perfectly maintained at the ratio 1:1 to ETH, and can represent ETH in DeFi transactions.
Furthermore, the platform has announced its native token $SWISE that grants the governance decisions into the hands of users.
With $SWISE, StakeWisers are able to vote for any big matters on the chain, from commission rates to how node operators function. The token also plays as the system currency by which staking profits are shared with stakers.
In addition, users holding on to $SWISE can get proportional rewards in accordance with their ETH deposit amount.
Additionally, StakeWise is offering higher return rates for early staking. Particularly, 2% of the $SWISE supply will be rewarded to the first 25,000 ETH staked into the pool. As a result, so far, one-third of the total $SWISE cap has already been seized by investors.
Various Staking Options
StakeWise is bringing the market a staking pool and self-staking mode. When members stake their ETH into StakeWise pool, the ETH 2.0 smart contract will tokenize the deposits into sETH2 tokens, then generate an equal amount of the reward token (rETH2) for every earned ETH from the pool.
Either sETHs or rETHs can be burnt to redeem ETH at the ratio 1:1.
Reward tokens are accrued every 24 hours and distributed to all pool members based on their staking proportion.
Except for a 10% commission cut which is held off to compensate for the system development and maintenance, StakeWise pool is completely free. Users can deposit any amount of ETH as they wish, there is no minimum limit about that.
In order to maintain the safety and transparency of transactions, every time new ETHs are staked in the pool contract, a respective validator client key is created by the system and sent to a user’s cloud storage.
With that private key, its owner can access their tokens anytime from connected devices. It unleashes boundless control over staked tokens as well as consolidates protection against any errors or malicious acts.
In solo staking mode, users will pay $10 USD per month in exchange to be a validator on StakeWise. Solo stakers are required to deposit no less than 32 ETH, then they can assign their own withdrawal credentials to manage their funds.
To prevent any system malfunction, StakeWise will keep users’ keys on a cloud service.
Thanks to that, stakers can rest assured that they can go online 100% of the time and touch their keys whenever they want. Other than the $10 USD flat rate, solo stakers are charged with no extra fees.
They can also request a withdrawal to their predetermined address anytime, using their own withdrawal key.
Trade and Management Solutions
Besides all the profitability aspects, the founding team has made StakeWise an enjoyable destination for any crypto holders.
By paying a lot of attention to user experience, the service combines admirable advancements of ETH 2.0, such as scalability and high speed, in a friendly interface.
Users are offered real-time tracking to keep a close eye on their deposits and stay tuned about their performance and rewards second-by-second.
Moreover, StakeWise allows stakers to integrate their registries with external applications via API. Thanks to that, staking becomes substantially easier, since users can make and control remote deposits without any issues.
There will be a lot of money to be made in ETH staking, and StakeWise has created a good platform for creating returns.
StakeWise is composed of an enthusiastic and experienced team, leading by the two co-founders, Dmitri Tsumak and Kirill Kutakov.
Dmitri is a senior developer that loves blockchain technology, Kirill has built a solid background in the financial asset management sector.
Working together, the two young men have devoted all their hearts and mind to turning StakeWise into a friendly yet effective environment for ERC-20 transactions.
Speaking to the media, one of the two StakeWise founders, Dmitri, claimed their vision of making the best use of tokenomics and DAO governance to shape a thoroughly community-oriented crypto platform.
Not only is the platform shifting voting power to users, but StakeWise is also confident about bringing higher-yielding ratios for stakers, and ensuring security for its deposits.
The StakeWise social community is present on GitHub, Twitter, and Telegram, with timely updates on its latest progress. For those who want to join an early ETH staking and receive extra token rewards, StakeWise might be a good choice.