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MetaMask Launches Consensys-Powered Ethereum Validator Staking Service

The new service, created with Consensys Staking, streamlines Ethereum validator node operation but charges a 10% reward fee.

MetaMask has launched Staking-as-a-Service (SaaS) for Ethereum, allowing users to run their own validator nodes with Consensys Staking. This service, however, comes with a price, as the crypto wallet provider takes a 10% cut.

Unlike traditional SaaS methods, where staking providers enable users to pool resources to meet the 32 ETH threshold for running a validator node and share the rewards, MetaMask's service requires the full 32 ETH from individual users, around $75,900 at the current rate.

Validator Staking eliminates the need for users to engage in pooling or to have complex hardware setups for hosting a validator node via MetaMask Portfolio. The crypto wallet provider said on X that it runs the validator node securely, simplifies the staking process, and reduces associated risks, such as slashing and downtime.

MetaMask Portfolio uses Consensys Staking's validator infrastructure for its backend, which has been operational since the Beacon Chain launch in 2020. Its setup includes a variety of validator clients and distributed infrastructure across multiple regions and cloud providers.

MetaMask reported that the system has managed over 33,000 validators with a record of zero slashing incidents. It also maintains a high validator uptime of 99.99%. The rewards rate through this system has been noted to be around 7% higher than the network average, based on data from late 2023. Around $2 billion worth of ETH, representing 4% of all staked ETH, is managed by Consensys Staking.

While staking currently yields 3.8%, MetaMask charges a 10% fee on the rewards earned from validator operations. This price is a critical consideration for users, especially compared to other staking options available in the market.

For instance, Lido, the leading liquid staking platform, offers a similar yield of around 3.4% after deducting its fees, and Coinbase takes a 25% cut on ETH staking rewards.

Lefteris Karapetsas, the founder of portfolio management app Rotki, commented that MetaMask's new service is an "interesting idea but a 10% fee makes it a completely unattractive option for any user who bothers to compare with the other available options out there."

Still, the service may attract users who are crypto-rich and particularly time-poor (or lazy). We shall continue to Observe.