In brief

BETH is a tokenized version of ETH staking on Binance. It's a simple way to participate in staking on the Beacon Chain - ETH 2.0. By holding BETH, you are entitled to receive ETH 2.0 staking rewards from the Binance staking node. But that's not all, because you can take advantage of it in many other ways on the Binance and Binance Smart Chain (BSC) platforms.

Introduce

With the launch of Beacon Chain in December 2020, upgrades (ETH 2.0) to improve Ethereum's scalability are on track. As part of phase 0 of Ethereum's new implementation plan, ETH can now be staked on this new chain. BETH allows you to easily participate in ETH staking without losing flexibility - withdraw your ETH at any time.

What is BETH?

BETH is the tokenized version of the ETH you staked. In other words, each BETH represents 1 ETH staked on Binance. Wait, so is Ethereum using the Proof of Work (PoW) algorithm? Yes, but only for now. However, as part of ETH 2.0, Ethereum will completely move to Proof of Stake (PoS).

Due to the complexity of the upgrade, this will be rolled out in multiple phases. The first step of the upgrade is the launch of the Beacon Chain. This chain will be the core of Eth2 once partitioning and splitting of large databases into smaller pieces (sharding) is fully implemented. Beacon Chain is live and as of March 2021, there was more than 3.5 million ETH secured to it.

The staking contract for Beacon Chain only works one way. This means users can deposit, but they will not be able to withdraw until ETH 2.0 is fully launched – which could take years. Additionally, they can only deposit a fixed amount of 32 ETH.

All that ETH in the Beacon Chain has received staking rewards. So, what if you don't have 32 ETH or you want the flexibility to withdraw? You can join one of the many ETH 2.0 staking pools. One of them was created by Binance.

You can convert your ETH to BETH at a 1:1 ratio and start receiving staking rewards in BETH. Great, but what if you still want to use your ETH elsewhere? Binance already has a spot market for BETH/ETH pair, you can convert your BETH to ETH easily.

How to use BETH

You can use BETH in many ways. The simplest way is to hold it on Binance and receive staking rewards. You can also withdraw your BETH to Binance Smart Chain (BSC) and use it in DeFi applications. Let's take a look at the options available here!

Use BETH on Binance Launchpool and Liquid Swap

If you are holding BETH on Binance, you can use it to earn additional rewards. For example: Some Launchpool projects use BETH as a staking currency. Simply lock your BETH into Launchpool and earn the newly launched token, which will get you instant liquidity from Binance's spot exchange.

Use BETH on Binance Liquid Swap

You can also use BETH on Binance Liquid Swap. For example, you can earn rewards by providing liquidity to the ETH/BETH liquidity pool. Note that you can add ETH, BETH, or both to the liquidity pool - but if you add both, you won't pay fees.

Use BETH in borrow-borrow protocols

Another option is to deposit BETH in a currency market like Venus and earn yield or use it as collateral to borrow other coins.

Use BETH on PancakeSwap

You can also provide liquidity to the BETH/ETH pair on PancakeSwap and receive CAKE. Note, since PancakeSwap works similarly to Uniswap, you will also need a tokenized version of ETH on BSC to provide equivalent value of the two tokens.

The advantage of providing liquidity to this pool is that BETH and ETH are priced the same or very similar, so you experience less temporary loss than other pools. If you don't understand what that means, read our Interim Loss Explained article.

In short, this pool is less susceptible to temporary losses, as volatility between BETH and ETH is relatively much lower than other pairs like ETH and BUSD. In other words, the price between ETH and BETH generally fluctuates within a small range, so the impact of temporary losses is also relatively small.

BETH with profit optimization tools

Finally, you can also use BETH with one of the profit optimization tools on BSC. You stake BETH and the protocol automatically searches for the best profit-generating opportunities for you. Beefy and Autofarm are two examples that support BETH.

Is BETH more valuable than ETH?

If you observe the BETH/ETH market on Binance, you will see that BETH does not trade at a 1:1 ratio with ETH - even though each BETH represents 1 staked ETH. Why is this necessary? The short answer is because their benefits are not the same. The price difference between BETH and ETH depends entirely on the market. BETH is the tokenized version of the ETH you staked.

Therefore, BETH has a different meaning from ETH. In fact, the different prices mean that the market is valuing BETH and ETH differently. BETH cannot currently be exchanged for ETH instantly, which means it is less flexible than ETH. But it allows cryptocurrency holders to stake and receive free rewards.

summary

BETH is a tokenized version of ETH staking on Binance. You can earn ETH 2.0 staking rewards without having to worry about the technical requirements of setting up and maintaining an ETH 2.0 staking node. Additionally, there are several ways to earn more profits using DeFi applications on Binance Smart Chain.