Thank you for sharing. It’s great to see these services already commit to Eth2 staking.
I wouldn’t call this a secondary market though. This is more Coinbase becoming an intermediary between the customer and the Eth2 staking process.
A secondary market would be being able to buy and sell validator nodes. I do not think this would happen for two reasons:
Security. Every validator has a set of keys. A secondary market would imply the sharing of those keys.
Pricing. A secondary market would imply that the market value of validators (32 ETH) would fluctuate. Why would you sell a validator for lower than 32 ETH (and inversely buy a validator for more than 32 ETH) if the consensus protocol will always allow you to set up a node (and in phase 1.5 and beyond, exit a node) for 32 ETH?
If I understand correctly, then Rocket Pool fits the bill.
It is a network (with mild centralization) that allows people to buy and sell shares of a validator pool. Risk is spread across the network in case of node failure.
Note on 1, the withdrawal key is separate from the validator key, such that one can validate but not withdraw.
Edit: Though I agree on 2, that in the long term the fees such networks will be able to charge will decline significantly.
Actually, Coinbase just announced intent to deliver this secondary market. A tokenized Eth2 stake may then also be traded on DeFi exchanges. https://blog.coinbase.com/ethereum-2-0-staking-rewards-are-coming-soon-to-coinbase-a25d8ac622d5
Thank you for sharing. It’s great to see these services already commit to Eth2 staking.
I wouldn’t call this a secondary market though. This is more Coinbase becoming an intermediary between the customer and the Eth2 staking process.
A secondary market would be being able to buy and sell validator nodes. I do not think this would happen for two reasons:
Security. Every validator has a set of keys. A secondary market would imply the sharing of those keys.
Pricing. A secondary market would imply that the market value of validators (32 ETH) would fluctuate. Why would you sell a validator for lower than 32 ETH (and inversely buy a validator for more than 32 ETH) if the consensus protocol will always allow you to set up a node (and in phase 1.5 and beyond, exit a node) for 32 ETH?
If I understand correctly, then Rocket Pool fits the bill. It is a network (with mild centralization) that allows people to buy and sell shares of a validator pool. Risk is spread across the network in case of node failure.
Note on 1, the withdrawal key is separate from the validator key, such that one can validate but not withdraw.
Edit: Though I agree on 2, that in the long term the fees such networks will be able to charge will decline significantly.