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The Genesis War Effort - The Daily Gwei #113
The Ethereum community must band together to launch the Beacon Chain.
The deposit contract went live last week and, at time of writing, ~49,000 ETH has been deposited by 232 unique depositors which represents ~9.4% of the required 524,288 ETH that must be deposited before eth2 phase 0 can launch. This is due to the fact that phase 0 (the Beacon Chain) requires a minimum of 16,384 validators in order to start producing blocks (32 ETH per validator * 16,384 validators = 524,288 total ETH staked). If this minimum is not reached 7 days before December 1st at 12PM UTC, then the Beacon Chain will not start at that time. You can track the progress by either following the Twitter account below or bookmarking this Dune Analytics dashboard.
Alright so let’s break this all down a bit more. To become a validator in eth2 phase 0 you need to follow the process outlined on the launchpad website here which involves generating your validator keys, backing them up, spinning up an eth1 node (optional), sending 32 ETH per validator that you’re spinning up to the deposit contract and then finally setting up your own eth2 client or clients. In return for doing this, the eth2 network will produce ETH-denominated rewards for stakers that decrease as more ETH is staked. At the minimum amount staked, the rewards are 21.6% ETH a year and at 1 million ETH staked it becomes 15.7% and so on - scroll down on this page to play around with the rewards slider.
The ‘minimum genesis time’ is just a configuration parameter given to the clients and if they all agree on this time - the Beacon Chain cannot launch unless the minimum validator threshold has been met and the current time is on or after December 1st, 2020 at 12PM UTC. Something that you may not be aware of though is that the deposit contract needs to reach the minimum of 524,288 ETH deposited 7 days before the minimum genesis time. This is because there is a ‘genesis delay’ of 7 days that only kicks in once the minimum amount of validators have been activated (16,384 or 524,288 ETH).
So what this all means is that we have around 15 days to find another ~474,000 worth of ETH that wants to stake in eth2 phase 0. Now, this is actually going to be a little difficult since sending ETH to the deposit contract is a 1-way street until phase 1.5, the ETH price has been trending up over the last few weeks which is dissuading people from locking up their ETH for 1-2 years, the 32 ETH required to stake is now worth ~$14,400 which is unfortunately out of reach for many people, there’s an opportunity cost of sending your ETH now rather than waiting until the day of, and getting involved with staking in phase 0 is still quite technical.
This is why I believe that what’s required to meet the minimum (outside of some benevolent whales) is for the whole Ethereum community to band together and focus on a ‘Genesis War Effort’.
Here are some things you can do to contribute to this war effort:
If you know someone that is interested in staking their ETH, send them this excellent guide from Bankless
If you don’t have the minimum required to run a validator (32 ETH), check out services like Rocket Pool that offer decentralized staking pool services
There are also centralized staking service providers out there that you can use if you are not comfortable staking on your own (though I strongly recommend setting up your own validators or using a decentralized service)
If you’ve set up some validators, be sure to make some noise about it on Twitter/Reddit to signal to others to do the same
If you’re stuck, the /r/ethstaker community will help you with any questions that you may have
I won’t sugar-coat it - it’s going to be an uphill battle to reach the minimum threshold 7 days before December 1st - I’m sure the eth2 researchers and developers didn’t anticipate an ETH bull run happening at the same time as the eth2 phase 0 launch! Who knows, we may see an influx of deposits over the next 2 weeks from a bunch of whales that gets us to the minimum ETH required but I would personally much prefer to see lots of individuals setting up their own validators instead of a few whales making up the majority of the network.
Ethereum needs you to join the Genesis War Effort - are you up to the task?
Have a great day everyone,
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All information presented above is for educational purposes only and should not be taken as investment advice.