Non-custodial multi-chain liquid staking platform, Stader Labs, has introduced a new product for Ethereum this week, promising the highest yield on ether (ETH) staking in comparison to other existing protocols.
Unlike traditional Ethereum staking that necessitates a minimum of 32 ETH, Stader Labs allows network node operators to maintain the blockchain with a significantly lower capital commitment of just 4 ETH. This represents an 85% decrease in necessary staking capital. Stader issues an ETHx token against the 4 ETH bond, which can represent the entire stake, with the remaining 28 ETH coming from liquid stakers.
Stader’s new service offers its users a reward boost of 50%, resulting in a reward rate surpassing 6%. Furthermore, node operators leveraging Stader’s service can see their yields on staked ETH increase by up to 35% thanks to 8x leverage.
Popular staking services, such as Lido and RocketPool, collectively manage $15.5 billion worth of ether, with yields ranging between 3% and 4%, as per Thursday’s data. Staking is a process where tokens are locked up for a set duration to maintain a blockchain’s operations, typically in exchange for token rewards. Such services are often compared to a savings bank due to their passive investment strategy.
However, the dominance of these protocols has led to criticism from developers, particularly around centralization issues, which Stader seeks to address. The CEO of Stader Labs, Amitej Gajjala, stated that to uphold their commitment to Ethereum’s decentralization, Stader has imposed a self-limit of 22% share of all staked ETH to mitigate centralization and encourage an equitable distribution of power among Ethereum staking solutions.
