What is Ethereum Proof of Stake?
Ethereum switched to a Proof-of-Stake (PoS) consensus algorithm in 2022 to improve the network’s speed, efficiency, and scalability. Before this change was made, Ethereum used Proof-of-Work (PoW) and a mining mechanism to process transactions. In PoS, instead of mining, users can stake their coins in order to validate transactions and earn rewards.
After the Merge, Ethereum's Mainnet is replaced with the Beacon Chain. On April 12, 2023, the Ethereum Shanghai Upgrade (EIP-4895) added withdrawal functionality.
For more details, please refer to these Academy articles:
- The Merge Ethereum Upgrade: All You Need To Know
- What Is Ethereum 2.0 And Why Does It Matter?
- What Is the Ethereum Shanghai Upgrade?
What is Binance ETH 2.0 Staking?
If you want to become a validator on Ethereum, you are required to stake a minimum of 32 ETH. You will need to fulfill the minimum staking requirement, prepare the hardware equipment, and hold some additional assets to settle the node operation costs. You must also consider other risks, such as slashing and liquidity risks associated with unstaking queues.
To address this, Binance launched the ETH 2.0 staking service to offer a more accessible way for everyone to participate in Ethereum staking. You can start with just 0.0001 ETH, and Binance will cover all validator operating expenses and bear the risk of on-chain penalties.
Note: Starting from 15 December 2022, Binance applies a 5% fee on ETH staking rewards. This fee will help to offset operating costs, such as hardware and network maintenance costs related to setting up validator nodes. The remaining on-chain staking rewards will be fully distributed to users.
How to participate in Binance ETH 2.0 Staking?
1. Log in to your Binance account and click [Earn] - [ETH 2.0].
2. Click [Stake Now].
3. Enter the amount you want to stake and you will see the BETH amount you can get. Read and agree to the terms and click [Confirm].
4. A second confirmation window will pop up. Read and confirm the terms and conditions by checking the boxes. Click [Confirm].
5. You have successfully staked your ETH. You can view your locked-up assets and reward details on the ETH 2.0 Staking landing page.
During the ETH 2.0 staking period, BETH rewards will be distributed daily based on user BETH holdings. The ETH redemption amount will be based on your current BETH holdings instead of your initial staked assets. For example, if you stake 100 ETH, you can get 100 BETH at a 1:1 ratio. On the redemption date, if you hold 110 BETH through a transaction and on-chain rewards distribution, you can redeem 110 ETH. Binance will cover all validator operating expenses for users on ETH 2.0 staking. For more details about the ETH 2.0 rewards distribution, please refer to the FAQ section on the ETH 2.0 Staking page.
Please note that you won’t be able to unstake your ETH until the Shanghai upgrade enables staking withdrawals (at least 6-12 months following the Merge). The redemption amount will be based on your current BETH holdings instead of your initial staked assets.
When will I start receiving the staking rewards?
The staking rewards will be distributed in the form of BETH to your Spot Wallet daily from T + 2 day. For example, if you choose to stake your ETH today (T - day), your BETH rewards will start accruing the next day (T + 1 day), and the staking rewards of T - day amount will be distributed on the next day after accruing (T + 2 day).
How to redeem from Binance ETH 2.0 Staking?
1. Log in to your Binance account and click [Earn] - [ETH 2.0]. Next, click the [Redeem] button.
2. Enter the amount of ETH you would like to redeem from your BETH balance, and click the [Redeem] button.
Please note that the expected ETH distribution date is indicated on the page and users can’t cancel their ETH redemption requests after submission.
- Available: The amount of BETH available in your Spot Wallet.
- Redeem Amount: The amount of BETH to redeem into ETH.
- Distribute: The amount of ETH to be returned to you.
- Amount Limit:
- Daily Personal Redeem Quota: Maximum daily amount of ETH that can be redeemed.
- Total Redemption Limit: Maximum amount of ETH that can be redeemed on the platform every 12 hours. The limit is updated twice a day.
- Redemption Date: Date and time of submission of redemption request.
- ETH Distribution Date: Expected date and time of ETH being returned to your Spot Wallet.
3. The redeemed ETH will be returned to your Spot Wallet when your ETH withdrawal requests is fully processed. The redemption amount will be based on your current BETH holdings.
- Due to the processing limitations on the Ethereum network, Binance will set a daily ETH redemption quota for each Binance user.
- The daily ETH redemption quota is subject to change.
- BETH tokens locked in pending ETH withdrawal requests will not generate any ETH 2.0 Staking rewards.
Frequently Asked Questions
1. Do I still receive BETH staking interest if I stake my BETH in Launchpool or other products?
No. The BETH staking interest is calculated based on the amount of BETH available in your [Fiat and Spot Wallet]. You will not receive staking interest if your BETH is deposited into Launchpool. BETH used as collateral for VIP Loan or Crypto Loan also generates BETH staking rewards daily.
2. Do I still receive BETH staking interest if I withdraw my BETH to an external address or BSC project?
No. The BETH staking interest is calculated based on the amount of BETH available in your [Fiat and Spot Wallet], or BETH amounts used as collateral for VIP Loan or Crypto Loan. You won’t receive staking interest if your BETH is withdrawn to an external address.
For more information on ETH 2.0 Staking, please refer to the FAQ section on the ETH 2.0 Staking page.
3. The Real-Time APR of BETH on Simple Earn Flexible Product is 0%; does it mean I won’t receive flexible rewards?
BETH subscribed to Simple Earn Flexible Products will continue to earn ETH Staking rewards, including BETH assets collateralized for Binance Flexible Loans. The Real-Time APR and Bonus Tiered APR will not apply for BETH on Simple Earn Flexible Products. You can check the ETH Staking page to determine the ETH Staking APR.
This document may have been translated and published in different languages. In the event of any inconsistency, misstatements, omissions, or errors appearing in any translated version, the English version shall prevail.