ConsenSys, a New York-based Ethereum software company, has partnered with cybersecurity firm Securosys to launch a more secure staking solution for Ethereum 2.0.
The new product, dubbed Codefi Staking, provides “institutional staking tools for Ethereum 2.0,” whose Beacon Chain launched on Dec. 1, 2020 after securing the minimum deposit contracts. By partnering with Securosys, ConsenSys said it was able to create a more secure method for long-term Ethereum staking.
The enhanced security is achieved by removing the “challenges of operating independent validator nodes,” ConsenSys said. Securosys provides multiple key control mechanisms to ensure that stakers never relinquish control over their Eth2 withdrawal keys.
“By combining Codefi with Securosys Hardware Security Modules our customers achieve the highest level of security and convenience when moving from Eth1 to Eth2,” said Kuhan Tharmananthar, the product lead at Codefi Staking.
Ethereum 2.0 brings the promise of proof-of-stake, or PoS, a major milestone for the smart contract platform. The transition from the current proof-of-work consensus to the desired PoS isn’t without challenges. To validate transactions on Eth2, stakers need “assurance that they are safe from all types of attacks and failures during the first transition phase,” the company said.
“Without specialized technical knowledge, becoming a validator on Eth2 is complicated,” James Beck, a director at ConsenSys, tells. “Maintaining validator infrastructure and fulfilling responsibilities generates both overhead and exposure to risk: Technical bugs, software failures, and connectivity issues can jeopardize rewards, mismanagement of keys and transaction problems can lead to a loss of principal funds.”
“Codefi Staking was built to make it easier for institutions to stake their own ETH or their customers’ ETH without the challenges of operating independent validator nodes.”
Under PoS, users can stake tokens to earn rewards for validating blocks. In the case of Ethereum, holding 32 Ether (ETH) entitles users to participate in the network and obtain a reward.
At the time of writing, more than 2.87 million ETH had been sent to the Eth2 deposit contract.
Ethereum’s price has been trekking upward at a faster rate than Bitcoin (BTC) over the past year. Last month, the cryptocurrency peaked at a new all-time high above $1,470 before backtracking. It now trades below $1,400 on major exchanges.