ETH2 is an upgrade to the Ethereum network, which intends to improve the network's security and scalability. This upgrade involves transitioning Ethereum's mining model (Proof-of-Work) to a staking model (Proof-of-Stake), which is likely to be completed by 2023.
Following this transition, users will be able to stake their ETH holdings. Staking implies actively participating in transaction validation (just like mining). Users with the minimum necessary ETH balance can validate transactions and earn staking rewards.
Rocket Pool is an ETH staking pool that lowers financial and hardware requirements for staking this cryptocurrency. With just 32 ETH, individual users can stake Ethereum on their own node. Sometimes, the value of 32 ETH makes it unreasonable for most crypto users. Rocket Pool can be the best option to begin Ethereum staking in such scenarios. Moreover, the infrastructure and liquidity of Rocket Pool make withdrawals almost effortless with no prior technical knowledge required. In addition, RPL, the project's native token, maintains an entirely decentralized governance process.
Rocket Pool majorly relies on smart contracts. Rocket Pool claims the crypto users as an integral part of the system. They verify transactions on the Ethereum 2.0 network. To begin the staking, a node operator must stake at least 16 ETH outside the protocol. After ETH is staked, the node can verify the transactions. In exchange for this, the node receives a reward. The amount of reward depends on the Supply and demand on the Ethereum network.
After receiving rewards, validators must wait for a certain period before they can withdraw assets and exchange them for ETH. In the long run, validators can also burn these rewards.
Furthermore, regular users can also stake Ethereum for rewards. Users must stake at least 0.01 ETH. In exchange for this, they receive rETH, which can be used for trading, lending, and collateral.
Rocket Pool also endorses Watchtower nodes. These nodes' role is to report information to the Ethereum proof-of-work network. This information helps set the rETH/ETH exchange rate and helps validators withdraw their tokens.
Rocket Pool utilizes the Ethereum Proof-of-Work protocol. This platform supports independent node operators, Staking as Service (SaaS) providers, and pool stakes. The SaaS enables regular Ethereum holders to participate in the verification process by delegating node operations to a third party.
Pooled stakers enable Ethereum users to participate in the staking protocol with a much lower deposit requirement. A Rocket Pool user can deposit as little as 0.01 ETH and, in return, receive rETH. This also enables a node operator to create a new Beacon Chain validator.
The rate of rETH is updated daily compared to ETH. It is a dynamic exchange rate, meaning you'll never receive the same amount of ETH as the ETH you put in. The rate depends on the Beacon Chain rewards and the staked ETH. This maintains the consensus algorithm. Users can trade rETH reward for ETH through Rocket Pool's smart contracts.
Rocket Pool provides liquidity and rapid withdrawals and offers its infrastructure to begin staking with a minimum of 0.01 ETH. The last part is great for regular crypto users looking to stake ETH for profit or to support the ecosystem.
In addition, Rocket Pool embraces a decentralized system where RPL, the native token of the protocol, is used for governance. This allows participants to vote on issues affecting the protocol. Moreover, the staking process is simple and requires a little technical expertise.
Keeping in mind the Extreme volatility of the Crypto market, dealing with any digital assets carries an inherent risk. However, the danger of performing crypto dealings using Rocket Pool is small. This is because Rocket Pool has received endorsements from several reputable auditors such as Sigma Prime and Consensys Diligence. Therefore, the protocol is more secure and safe than other ETH staking platforms.
The procedure of staking Ethereum with Rocket Pool is very straightforward and hassle-free. Here's how it all works:
Step 1:
Visit the Staking Section of Rocket Pool on the official website.
Step 2 :
Connect Your Wallet: Metamask is the most preferred by users. However, you can also use Wallet Connect, Unstoppable Domains, Frame, or Tally.
Step 3 :
Select the Right Network: While using the dropdown from your MetaMask connection, always select the correct network, i.e. "Ethereum Mainnet" and "Goerli Test Network."
Step 4:
Initiate Staking: After connecting your wallet, you can start staking your ETH. The main page of Rocket Pool's staking section enlists the necessary staking conditions to be met. Along with how much rETH you will receive, the exchange rate, and the transaction cost to be paid.
Step 5 :
Confirm the Transaction: Once you validate the transaction, you will receive your rETH. This amount will differ from the ETH you staked. The value depends on the dynamic exchange rate between the two currencies.
Step 6 :
Unstaking your ETH: Users can also unstake ETH anytime from the same dashboard. However, a 24-hour waiting period will be required. Technically, if you wait for a sufficient amount of time, the value of your rETH will increase, provided that the validators have been efficient.
Rocket Pool ETH (rETH) is the liquidity token of the protocol representing the amount of ETH deposited by each user. The value of rETH is calculated by an algorithm that considers the amount staked and the validator's rewards. Moreover, the rETH is tradable on Uniswap and Balancer as part of pairs that include wETH.
ETH: rETH = (amount of ETH staked on ETH1 / total validator balance on ETH2)
The RPL token
RPL is the native token of Rocket Pool, issued in the governance process of the protocol. This token ensures that the system remains trustless and decentralized. As insurance, RPL can also be staked on a Rocket Pool node.
While staking RPL, users also receive an additional reward of the same token. Operators can stake over 150% of the staked ETH's value. New RPL tokens are minted every 28 days; this period is known as a "checkpoint."
Tokenomics
RPL is distributed among the node operators in exchange for operating on the network. Rocket Pool claims that it purposely manages a 5% inflation rate of the RPL token.
Regular node operators that stake RPL receives 70%. The remaining 30% is split between Oracle DAO members and Protocol DAO Treasury. This offers additional incentives to operators who run essential parts of the network.
At the time of writing, RPL hosts a market cap of $434 million and a daily volume of nearly $3 million. The RPL's price has increased proportionally to the network's increase in popularity as a staking service.
Crypto analysts are generally optimistic about RPL's future price valuations. Many claim it can have a value between $27-$40 at some stage in 2022.
Rocket Pool is an Ethereum staking platform that endorses decentralization. Unique to the industry, it offers an easy alternative to stake ETH as an individual node validator. Regular users can also stake with a minimum of 0.01 ETH. Node validators must stake at least 16 ETH. In exchange, they receive rETH and/or RPL as rewards. This is a good and relatively secure way of supporting the Ethereum network while improving crypto balance.
Yes, Rocket Pool allows ETH staking. In exchange, you receive rETH and RPL if you serve as a node validator of the protocol.
Several Ethereum staking services are available; one of the most popular ones is Rocket Pool. This protocol allows users to stake with a minimum of 0.01 ETH and offers rewards in the form of rETH.
Users can stake and unstake ETH at any point on Rocket Pool. They receive rETH in exchange, and the value of rETH depends on the activity of node validators. During unstaking, users must wait 24 hours for an additional security measure.
Users can run individual nodes or stake a minimum of 0.01 ETH on Rocket Pool. In exchange, they can earn protocol tokens rETH and RPL.
Yes, you can. Node validators can also stake RPL because it acts as security insurance for the network. In exchange, node operators are rewarded with additional RPL tokens.
RPL is the native utility token of Rocket Pool, a decentralized Ethereum staking protocol.
Users can mint RPL tokens every 28 days. Node operators receive these as rewards. In addition, RPL is also available on Uniswap, CoinEx, or HotBit.
The exact value of rETH is calculated based on an algorithm that considers the amount of ETH that was staked, and the rewards are given. As time passes, the provided rewards for validators increase and their value.