Coinbase launches liquid staking token to ‘keep Ethereum decentralized’

Coinbase has launched a liquid token for its users who staked their Ethereum (ETH) connected its level called cbETH, according to an August 24 announcement.

Coinbase volition adhd enactment for Coinbase Wrapped Staked ETH (cbETH) connected the Ethereum web (ERC-20 token). Do not nonstop this plus implicit different networks oregon your funds volition beryllium lost.

What is cbETH? Let’s dive successful pic.twitter.com/n3Dp4OA6HO

— Coinbase Assets (@CoinbaseAssets) August 24, 2022

The speech revealed that the Coinbase wrapped staked ETH volition beryllium a “utility” ERC-20 token.

“Coinbase Wrapped Staked ETH (cbETH) is simply a inferior token that represents ETH2, which is ETH staked done Coinbase. cbETH tin beryllium sold oregon sent off-platform, portion ETH2 volition stay locked-up until a aboriginal protocol upgrade.”

According to the announcement, lone staking fees volition apply, and determination volition beryllium nary fees for wrapping and unwrapping the tokens.

Coinbase continued that the terms of cbEth doesn’t way the ETH worth astatine a 1:1 ratio arsenic it lone represents the staked ETH and accrued staking interest.

With the Ethereum Merge lone a fewer weeks away, involvement successful staking has increased. However, staked ETH withdrawals volition not beryllium enabled until the Shanghai update, scheduled for 2023.

Competing against “Lido”

The exchange’s whitepaper noted that Ethereum’s liquid staking marketplace is dominated by a “solution that is connected the verge of breaching (the) 33% web penetration” —a notation to Lido (LDO).

Coinbase believes that it would beryllium capable to vie against this solution due to the fact that it is simply a trusted marque wrong the community, thereby “keeping Ethereum decentralized and secured.”

According to Dune analytics data, Lido presently accounts for 31% of staked Ethereum, portion Coinbase accounts for 14% of staked Ethereum.

Community remains acrophobic astir centralized staking providers

There are inactive concerns astir what centralized staking providers could mean for Ethereum’s modulation to a proof-of-stake network.

Several manufacture players person expressed interest that Ethereum could beryllium prone to censorship from these entities, which mightiness springiness successful to regulatory pressures.

However, Coinbase CEO Brian Armstrong said the steadfast volition not comply with immoderate petition from regulators to censor transactions. Instead, it volition unopen down its staking work if determination are nary alternatives.

The station Coinbase launches liquid staking token to ‘keep Ethereum decentralized’ appeared archetypal connected CryptoSlate.