Stake Ethereum with Kiln, enterprise-grade staking
What is Ethereum?
Ethereum is a decentralized blockchain network; its native token or cryptocurrency is called Ether or ETH. Launched in 2015, it is now the world's second-largest blockchain platform by market capitalization after Bitcoin and it is the first to introduce smart contract functionality. On Ethereum, you can build a range of decentralized applications. As said by the nonprofit Ethereum Foundation: “Ethereum can be used to codify, decentralize, secure and trade just about anything.”
What is staking?
In a Proof-of-Stake blockchain, staking consists of locking native tokens to earn the right to secure a chain, and earn a yield while doing so. It has overtaken mining as the primary way to secure blockchain networks.
With ETH staking, users lock ETH to fund a validator, which helps secure the chain by proposing new blocks and attesting other validators’ blocks, and earns a yield in the process.
Why should you stake your assets?
Staking generates the safest and most predictable yields in the crypto space. It is the most natural yield feature in crypto as the value originates from the blockchain native currency inflation and a share of transaction fees.
- Put your treasury to work
- Diversify and earn
- Bring new opportunities to generate safe yields to your users
How to stake Ethereum with Kiln?
To stake ETH in a few clicks, just follow the next steps. It should take you less than 5 minutes to complete your first transaction:
- Login to Kiln dashboard
- Go to the /stake/eth page of the dashboard
- Select the Account you want to stake on
- Choose the amount of ETH you want to stake (must be a multiple of 32ETH)
- Connect your wallet (either web extension wallets or via WalletConnect)
- Click on the “Stake” button!
As easy as pie! No need to generate validation keys, send deposit information to the smart contract, connect with the Beacon chain… Kiln takes care of everything.
To stake ETH, you need 32 ETH to run your own validator and start staking. You can also participate in staking pools to mutualize your ETH (and staking rewards) with other users to reach the 32 ETH threshold.
What are the rewards associated with staking ETH?
As an incentive for helping to safeguard the network, you can earn up to 5.34% APR* from each validator you stake on Kiln.
Why should you stake your ETH with Kiln?
With more than 2.1% share of all ETH staked and heavy involvement within the community (Lido, Alluvial, Flashbots), Kiln has a strong track record running Ethereum validator. Kiln is the leading enterprise-grade staking platform enabling institutional customers to stake Ethereum, and build whitelabel Ethereum staking functionality into their offering.
- Stake ETH in 1 click
- Manage all your ETH stakes and rewards from a single dashboard
- Non-custodial, work with your existing custodians solutions e.g. Fireblocks
- SOC 2 certified and Industry leading SLAs (0 penalties recorded and 99.95% effective uptime)
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Stake Ethereum FAQ
What does Proof-of Stake mean?
Proof-of-Stake (PoS) is a type of consensus mechanism used to validate cryptocurrency transactions. Through PoS, validators can contribute to the block production of a chain while keeping environmental concerns to a minimum, which is becoming an increasingly large issue in Proof-of-Work.
By staking capital rather than energy, validators risk losing a portion of their value and future potential for staking by misbehaving while creating blocks. This incentives collaboration and fair practices while validating information in a similar way that PoW has with incentives and punishments to curtail malicious activity while creating consensus.
When will I receive ETH rewards?
Staking rewards start to accrue as soon as the validator is active. Part of the rewards are liquid and immediately retrievable (so-called execution-layer rewards, consisting in about half the yield). The other part are ‘locked’ until withdrawals are enabled on the Ethereum network, which is expected 6-12 months after the Merge upgrade.
Can I choose which wallet to receive my rewards on and can I split them between multiple wallets?
Yes, when staking Ethereum you can decide which wallet to receive your rewards.
Are gas fees automatically charged on top of the 32ETH from the sending wallet and if not, how will the network fee be charged?
Gas is the fee paid for executing transactions on the Ethereum blockchain. They will be charged on top of the 32 ETH.
What are the risks associated with staking ETH?
The main risk is slashing. An Ethereum validator can be slashed if:
- It signs two attestations with a different head
- It surrounds another attestation with its attestation
- It submits two attestations with the same target
To prevent any risk, Kiln works with the “Better down than slashed” motto and applies the best industry standards to its Ethereum infrastructure.
Kiln also partnered with Nexus Mutual and offers a coverage policy to protect against middle slashing events. Nexus Mutual is the trusted partner for tier-1 institutional funds, family offices and custodians that seek protection across the crypto industry.
Apart from the risk of slashing, there can also be a downtime risk that means that a node is not signing transactions. However to prevent it, Kiln maintains a strong monitoring process.
Is there a minimum and maximum amount to stake for Ethereum?
Yes, currently you must first have 32 ETH or a multiple of 32 ETH to participate. However we are working on a ‘pooling’ product for lower amounts.
Do I maintain custody of my ETH tokens? Is ETH staking non-custodial?
You can maintain custody of your ETH through any wallet or custodian solution of your choosing. Kiln’s ETH staking is non-custodial, only you can access your funds by controlling the underlying wallet which holds a claim to the funds.
What is the lockup period to stake Ethereum? When can I unstake and withdraw my ETH?
Staked ETH, including rewards, are inaccessible for now. Withdrawals are not implemented yet, but will be part of a future upgrade. There will be 2 scenarios:
- With an Ethereum wallet as withdrawal key: the validation key will sign an unstake transactions and the same withdrawal address will receive the funds
- With a BLS key as a withdrawal address: the validation key will sign an unstake transaction and the BLS key will sign a transaction to set itself as the withdrawal address. The latest will receive the funds.
Execution-level rewards (transaction fee) are sent directly to the Ethereum wallet of the staker whose validator produced the block.
How do rewards and penalties work?
For every slot, the validator is expected to sign attestations. If submitted attestations are good, the validator receives rewards, otherwise it receives penalties. In case the validator is offline it will also receive penalties.
What is the average block time on Ethereum?
The average block time on Ethereum is currently 12 seconds.
What is an Ethereum validator?
From an infrastructure point of view, an Ethereum validator is just a validation keypair. Multiple validation keys can run in one light program called a “validator”. This validator is connected to a Beacon Chain node which is paired with the rest of the network and constantly fetches the state of the chain. Kiln has over 8,500 live validators on Ethereum.
What is MEV?
MEV means “Maximal Extractable Value” and it refers to the maximum value that can be extracted from block production. Kiln was the first node operator to deploy Flashbots’ solution on PoS Ethereum. You can check our latest article about MEV from our experts.
What is an Annual Percentage Rate (APR) and how is it different from Annual Percentage Yield (APY)?
APR, or annual percentage rate, is the fixed interest rate earned on an investment over a one-year period. It is the percentage of return investors can expect to receive on their investment. On the other hand, APY or annual percentage yield, takes into account the compounding of interest on a fixed schedule. It includes both the interest earned and the interest on previously earned interest.
When it comes to PoS protocols, compounding does not always apply as additional validators can be needed to stake more. Therefore, APR is used instead of APY. It's worth noting that APY and APR cannot be compared directly, as they measure different things. However, it is possible to convert APR to APY and vice versa.
Where can I learn more about Ethereum?
There are many existing resources but we invite you to visit the Ethereum foundation's website and to check our latest articles about the Merge and the Ethereum blockchain on our blog.