MetaMask, a cryptocurrency wallet company, has introduced a new staking service that allows users to combine their funds and stake their assets in top-tier validators run by Consensys, a blockchain software firm.
This service enables MetaMask users to stake their Ether (ETH) without having to meet Ethereum’s high minimum requirement of 32 ETH, which is currently valued at around $112,000. By utilizing MetaMask’s staking pool, users can stake less than the required amount of ETH and still receive rewards for helping to secure the network.
ETH staking involves validators processing transactions, storing data, and adding blocks to the Beacon Chain since Ethereum transitioned to a proof-of-stake (PoS) consensus mechanism. Validators play a crucial role in maintaining the network’s security and decentralization. Consensys senior product manager Matthieu Saint Olive believes that MetaMask’s staking service enhances Ethereum’s decentralization and security.
Validators receive interest on their staked coins for actively participating in Ethereum, but there is a risk of losing staked ETH if a validator fails to fulfill its duties or engages in collusion, known as “slashing.” Saint Olive mentioned that Consensys’ validators have operated smoothly without any slashing incidents since 2020.
Despite the potential benefits of staking, a majority of ETH holders do not possess the minimum 32 ETH required to become a validator. The soaring price of ETH, currently around $3,500, has made it expensive to participate in Ethereum staking, leading to only 1% of ETH holders meeting the minimum requirement.
MetaMask’s new service aims to address this issue by allowing users with less than 32 ETH to participate in network staking through Consensys validators. They can also withdraw their assets at any time based on the validators’ exit queue protocols.
While the service offers convenience to ETH holders, it is currently unavailable in the US and UK. MetaMask is actively working to make the service accessible in these regions. Saint Olive mentioned that they are monitoring regulatory developments in the US and UK, expecting to launch the service once the policies become clearer.
In a recent interview, Consensys CEO and Ethereum co-founder Joseph Lubin compared the new service to liquid staking, emphasizing its ease of use for allocating and withdrawing Ether quickly.