When we are about to discuss ETH 2.0 Staking, we should understand ETH 2.0 and staking separately first as it will help us understand the ETH 2.0 Staking properly. 

ETH 2.0 is an upgraded version of the ETH blockchain. It is no different from ETH, the same previous ETH blockchain that was worked under the Proof-of-work mechanism, upgraded in ETH 2.0 in 2022 after getting merged with Beacon Chain which was worked under the Proof-of-Stake mechanism. So, the only difference that came after the upgradation of ETH was the conversion of PoW to PoS. Now, coming toward staking. 

Staking is the process of holding the purchased coins on the network for a preset time period and in return, the network incentivized the validator with interest. To activate a validator, you’ll be needed 32 ETHs, and the network disables the validator if the ETH balance got lesser than 16 ETHs.

What should you stake on ETH 2.0?

• Earn rewards: When a validator takes efforts to help the network in reaching the consensus layer, it is rewarded by the network for actions. By ETH 2.0, the validators (who stake) get rewarded for making sure that the chain is running properly (properly batching the transaction into blocks) and for verifying the work of other validators because it helps the chain in running securely.

• Better security: To control a network, as more as possible ETHs are needed. ETH 2.0 staking helps the ETH network in security by building the blocks through the staked ETHs. ETH network becomes stronger by staking the most possible ETHs.

• More sustainable: The process of staking doesn’t ask for an energy-intensive proof-of-work mechanism for taking part in ETH 2.0 staking. Stakers use the Proof-of-stake mechanisms that diminish the requirement for complex PoW computation. With PoS, nodes can run using simple hardware consuming a small amount of energy.

What types of staking take place on ETH 2.0?

If you are puzzled and not able to choose a perfect staking method that can make as more as possible out of staking, this guide will help you with making an apt choice. Here, I’m going to elaborate on some prominent ETH 2.0 staking types to make it easy for you.

• Solo home staking

To participate in the ETH 2.0 Staking, the one prominent way is Solo home staking. This is a gold standard staking and to follow this, a validator needs at least 32 ETH. By choosing this method of staking, a validator can get complete participation rewards as well as it enhances the decentralization of the ETH network. To participate in staking through this method, you don’t need to trust any third person, furthermore, you’ll get rewarded for batching your stake into new blocks and for checking the other validators’ work.

• Staking as a service 

If you are so used to handling the hardware but interested in ETH 2.0 staking, you can delegate the hard part of the staking by choosing the Staking-as-a-service method. In this process, you need to develop a validator credential set, delegate your signing keys to those validators, and then you can proceed by staking 32 ETHs. This staking method demands a level of trust in the provider and allows you to earn native block incentives.

• Pooled staking

There are so many pooled staking options available in the crypto market for assisting the ones who are not comfortable with 32 ETHs. These methods are known as liquid staking and in this process, ERC-20 tokens represent the stakes ETHs. This method is quite prominent and makes staking simple as a token swap. Liquid staking allows the validators to hold the token custody in their ETH wallet. However, this staking method is not offered by the ETH network, several third parties are proving this service, that’s why it involves a risk.

The Final Take!

As you have read in this blog that there are so many staking methods available in the blockchain industry, these all methods target worldwide stakers with different staking requirements. This read is compiled with all the essential information needed to know for making a better ETH 2.0 staking method choice. Do remember that there is no one-size-fits-all staking option available so go through this read and choose the one you prefer.