Welcome to the beginning of your journey down the DeFi rabbit hole! For the first leg of our trip, we’ll be learning how to stake ETH using Lido - a state of the art liquid staking protocol. If that sentence was complete gibberish, don’t worry! You’re in the right place — we’ll be right here to guide you through everything.
Before we get going, let’s make sure you have the right equipment. In order to stake ETH, you will need:
An Ethereum wallet, such as MetaMask or Rainbow
ETH in that wallet for gas fees
If you need help getting your gear in order, head over to our YouTube Channel. There, you’ll find guides for setting up your wallet and purchasing some ETH!
Now that we’ve got our equipment ready, let’s talk about where we’re headed.
On a proof of stake blockchain network, like the upcoming Ethereum 2.0, staking is the consensus mechanism used to secure the network and allow it to operate. The individuals who participate in staking are known as validators. These validators keep the blockchain safe and functioning by validating transactions and creating blocks.
In order to participate, validators need to stake a certain amount of cryptocurrency as collateral. If a validator does something to harm or disrupt the network, they will have some of their staked crypto taken from them, or slashed. On the other hand, as validators successfully validate transactions and create blocks, they receive rewards in the form of crypto. This system of slashing and rewarding incentivizes validators to act in the best interest of the network.
On Ethereum 2.0, you need a minimum of 32 ETH in order to become a validator. But if you don’t have 32 ETH sitting around, you can still participate in staking and get a cut of those rewards. That’s where Lido comes in.
Lido is a decentralized staking solution that allows everyone to participate in staking with no minimum deposit. When you stake your ETH with Lido, you are effectively delegating it to a trusted validator. As that validator supports the network and receives their rewards, you get a cut of those rewards! And to top it all off, Lido will give you stETH (staked ETH) proportional to the amount of ETH you staked.
So, what does all this mean? By staking with Lido, you’ll be passively earning interest on your ETH while maintaining the freedom to utilize it in a variety of DeFi protocols via your stETH. It’s like being able to spend cash even while it’s sitting in an interest-bearing savings account. Plus, you’ll be directly contributing to the security and health of the Ethereum blockchain.
Finally, there are a couple potential hazards you should be aware of before we set out. When staking your ETH, you will receive your stETH at a 1:1 ratio immediately. However, the ETH you stake will be locked up until Ethereum 2.0 goes live (otherwise known as The Merge). This is currently slated to take place in Q2 2022, but is subject to change. Once The Merge is complete, though, you will be able to swap your stETH back directly for ETH. You can find more info on The Merge here. And while stETH can be used in a number of DeFi protocols, it cannot be used in all of the same ways ETH can, such as for purchasing NFTs or paying gas fees.
Okay, now that we’ve found our footing, let’s get started!
Head over to lido.fi, scroll down to Ethereum 2.0, and click Stake Now.
You will be brought to the app, and you may be prompted automatically to connect your wallet. If not, click Connect Wallet in the center.
Once your wallet is connected, you will see how much ETH you have available to stake as well as the current APR. You can now enter the amount of ETH that you would like to stake. Then, click Submit.
Your wallet will prompt you to confirm the transaction. Like with any on-chain transaction, there will be a small gas fee associated with it. If everything looks correct, click Confirm.
A loading screen will appear while the transaction is being validated and added to the blockchain. After a few minutes, you’ll be notified that staking was successful. You’ll also be shown your new stETH balance, which you can see immediately in your wallet.
If you don’t see your stETH in your wallet, you can manually add the token as a Custom token. You can do this by opening your wallet, scrolling down to Import tokens, and entering the following information in the Custom Token tab:
Contract Address: 0xae7ab96520DE3A18E5e111B5EaAb095312D7fE84
Symbol: stETH
Decimals: 18
You have successfully staked ETH on Lido! Your staked ETH is already accruing interest, and you will see your stETH balance update on a daily basis in your wallet.
This is just the beginning of our DeFi journey. On our next stop, we’ll be heading to Aave and using our stETH as collateral!
Welcome to the beginning of your journey down the DeFi rabbit hole! For the first leg of our trip, we’ll be learning how to stake ETH using Lido - a state of the art liquid staking protocol. If that sentence was complete gibberish, don’t worry! You’re in the right place — we’ll be right here to guide you through everything.
Before we get going, let’s make sure you have the right equipment. In order to stake ETH, you will need:
An Ethereum wallet, such as MetaMask or Rainbow
ETH in that wallet for gas fees
If you need help getting your gear in order, head over to our YouTube Channel. There, you’ll find guides for setting up your wallet and purchasing some ETH!
Now that we’ve got our equipment ready, let’s talk about where we’re headed.
On a proof of stake blockchain network, like the upcoming Ethereum 2.0, staking is the consensus mechanism used to secure the network and allow it to operate. The individuals who participate in staking are known as validators. These validators keep the blockchain safe and functioning by validating transactions and creating blocks.
In order to participate, validators need to stake a certain amount of cryptocurrency as collateral. If a validator does something to harm or disrupt the network, they will have some of their staked crypto taken from them, or slashed. On the other hand, as validators successfully validate transactions and create blocks, they receive rewards in the form of crypto. This system of slashing and rewarding incentivizes validators to act in the best interest of the network.
On Ethereum 2.0, you need a minimum of 32 ETH in order to become a validator. But if you don’t have 32 ETH sitting around, you can still participate in staking and get a cut of those rewards. That’s where Lido comes in.
Lido is a decentralized staking solution that allows everyone to participate in staking with no minimum deposit. When you stake your ETH with Lido, you are effectively delegating it to a trusted validator. As that validator supports the network and receives their rewards, you get a cut of those rewards! And to top it all off, Lido will give you stETH (staked ETH) proportional to the amount of ETH you staked.
So, what does all this mean? By staking with Lido, you’ll be passively earning interest on your ETH while maintaining the freedom to utilize it in a variety of DeFi protocols via your stETH. It’s like being able to spend cash even while it’s sitting in an interest-bearing savings account. Plus, you’ll be directly contributing to the security and health of the Ethereum blockchain.
Finally, there are a couple potential hazards you should be aware of before we set out. When staking your ETH, you will receive your stETH at a 1:1 ratio immediately. However, the ETH you stake will be locked up until Ethereum 2.0 goes live (otherwise known as The Merge). This is currently slated to take place in Q2 2022, but is subject to change. Once The Merge is complete, though, you will be able to swap your stETH back directly for ETH. You can find more info on The Merge here. And while stETH can be used in a number of DeFi protocols, it cannot be used in all of the same ways ETH can, such as for purchasing NFTs or paying gas fees.
Okay, now that we’ve found our footing, let’s get started!
Head over to lido.fi, scroll down to Ethereum 2.0, and click Stake Now.
You will be brought to the app, and you may be prompted automatically to connect your wallet. If not, click Connect Wallet in the center.
Once your wallet is connected, you will see how much ETH you have available to stake as well as the current APR. You can now enter the amount of ETH that you would like to stake. Then, click Submit.
Your wallet will prompt you to confirm the transaction. Like with any on-chain transaction, there will be a small gas fee associated with it. If everything looks correct, click Confirm.
A loading screen will appear while the transaction is being validated and added to the blockchain. After a few minutes, you’ll be notified that staking was successful. You’ll also be shown your new stETH balance, which you can see immediately in your wallet.
If you don’t see your stETH in your wallet, you can manually add the token as a Custom token. You can do this by opening your wallet, scrolling down to Import tokens, and entering the following information in the Custom Token tab:
Contract Address: 0xae7ab96520DE3A18E5e111B5EaAb095312D7fE84
Symbol: stETH
Decimals: 18
You have successfully staked ETH on Lido! Your staked ETH is already accruing interest, and you will see your stETH balance update on a daily basis in your wallet.
This is just the beginning of our DeFi journey. On our next stop, we’ll be heading to Aave and using our stETH as collateral!
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