Lido Staked Ether (STETH) is a Wrapped Ether (WETH) token on the Ethereum network that represents the value of a user's stake in the Ethereum 2 moreLido Staked Ether (STETH) is a Wrapped Ether (WETH) token on the Ethereum network that represents the value of a user's stake in the Ethereum 2.0 network. STETH holders can earn staking rewards, which incentivizes participation in Ethereum's Proof-of-Stake consensus mechanism.
Some of the potential benefits of STETH include:
1. Earning staking rewards: STETH holders can earn a variable interest rate on their staked ETH, which can vary based on network conditions and demand for validator slots. As of August 2021, the APY for staked ETH on Lido was around 5-6%.
2. Liquidity: STETH is an ERC-20 token, which means it can be freely traded on decentralized exchanges (DEXs) and used in Ethereum-based DeFi applications. This allows users to have easier access to liquidity than if they were directly staking their ETH on the Ethereum 2.0 network.
3. Reduced risk: Staking ETH on the Ethereum 2.0 network requires a minimum deposit of 32 ETH, which is a significant amount of money for most people. Lido offers an alternative way to participate in staking with as little as 0.01 ETH, which reduces the risk of losing a large amount of money due to market volatility or unexpected network issues.
4. Increased network security: Staking ETH on the Ethereum 2.0 network helps to secure the network and prevent centralization. By holding STETH, users indirectly contribute to the security of the Ethereum network.
Overall, Lido Staked Ether provides a convenient and accessible way for ETH holders to participate in Ethereum 2.0 staking and earn staking rewards. The STETH token serves as a representation of the staked value and can be used for trading, lending, and other DeFi applications.
Sources:
- Lido's official website: https://lido.fi/
- Lido's Medium blog: https://medium.com/lido-blog
- Ethresear.ch forum: https://ethresear.ch/t/lido-a-liability-free-staking-as-a-service-protocol/8433 (AI generated summary)
1:1 tokenization from ETH to stETH
stETH are freely tradable while they generate staking rewards
Disclaimer: Der Handel mit Kryptowährungen birgt ein hohes Risiko und kann bis zum Totalverlust des eingesetzten Kapitals führen. Keine der hier aufgeführten Informationen sind als Anlageberatatung zu verstehen. Alle genannten Kurse sind ohne Gewähr. Bitte beachten Sie dazu auch den den Haftungsausschluss im Impressum. Mit markierte Links sind 'Affiliate-Links', die uns dabei helfen diese Inhalte kostenfrei und ohne Werbebanner anbieten zu können.