ConsenSys launches staking service for Ethereum 2.0 with support from Binance, Huobi

ConsenSys has entered the staking-as-a-service industry with the announcement its Codefi branch is launching a white-labeled professional validator for ETH 2.0. The service caters to exchanges, custodians, and other institutions looking to offer ETH 2.0 staking rewards to clients without building the infrastructure in-house.

Crypto exchanges Binance, Huobi, and Crypto.com have signed on as pilot participants to test the new offering. DARMA Capital (co-headed by former ConsenSys Head of Global Business Development, Andrew Keys), custodian Trustology (a former ConsenSys spoke), and Matrixport round out the remaining early participants to join the Codefi Staking Pilot Program.

Why it matters:

• Professional and exchange-based staking services will open the door wide open for staking participation in ETH 2.0. As Binance CEO CZ notes, they’ll allow users to bypass the known hurdles to ETH 2.0 staking, such as the 32 ETH staking minimum and lock-up period (to a degree). There are two points to note from this development. (1) The amount of ETH dedicated to staking could be even higher than initial estimates, and this supply suck could more seriously compete with DeFi and development use cases. (2) Exchange-based services also tend to accelerate the concentration of staking power, thus threatening the democratization of validators and asset ownership.
• This is a logical business move for ConsenSys as it looks to launch more revenue-generating products. It was low-lift because the Codefi team was already working on the ETH 2.0 Launchpad alongside the Ethereum Foundation. This web-based portal will allow users to sign-up as a validator on the Beacon Chain. Professional validating services can also be a lucrative venture, as demonstrated by Coinbase’s Tezos staking rewards program.