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.
Introducing Validator Staking on MetaMask Portfolio.🦊
— MetaMask 🦊🫰 (@MetaMask) January 18, 2024
With a 32 ETH deposit, we run your very own validator node where you're always in control.
No pooling. No hardware. Just rewards.✔️
🔗 https://t.co/rmCtgs86WO pic.twitter.com/R8VRttP2XX
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.
