Coinbase is the second most used exchange in the world. It is also the main platform used in the United States for the exchange of cryptos. As the Merger approaches, which marks the transition of Ethereum (ETH) from Proof-of-Work to Proof-of-Stake, the exchange is launching a remarkable project.
Discover the Coinbase Wrapped Staked Ethereum (cbETH)
During the merger, the ETH2 will remain locked on the Ethereum network, until the end of the update. Users will therefore not normally have access to the new version of the ETH token throughout the transition. But, the American exchange has found a way to allow its users to use their ETH2 despite the Merger.
Indeed, Coinbase has decided to launch a personalized digital asset called Wrapped Staked Ethereum (cbETH). In this regard, the cryptocurrency exchange said: “ Coinbase allows clients who stake ETH to receive an ERC20 utility token called Coinbase Wrapped Staked ETH (cbETH) which is a liquid representation of their staked ETH. ».
« All staked ETH is blocked until a future Ethereum protocol upgrade is completed. In the meantime, Coinbase has created cbETH to give customers the opportunity to sell, transfer, spend or otherwise use their staked ETH while it remains locked “, he added.
The new ether-based token (ETH) from Coinbase is a liquid and tradable asset. Only investors who have staked their Ethereum on the platform can get it. It is possible to move it out of Coinbase, but not on other blockchains. The exchange warns users: “ Do not send this asset to other networks or your funds will be lost. ».
Announcing the launch of the cbETH utility token, Coinbase said that its price is not intended to be that of 1:1 ETH. The exchange clarified: “cbETH represents the staked ETH plus all its accumulated staking interest, from the moment the conversion rate and the cbETH balance were initialized (June 16, 2022). ».
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