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- Ether Capital Company operates an Ethereum 2.0 validation node and participates in the delegation process to obtain rewards for staking.
- Messari researcher Ryan Watkins predicts an increase in demand for ETH following the launch of the Beacon Chain.
In a press release, Ether Capital Corporation announced that it has invested funds for the Ethereum 2.0 network. Additionally, the company began running an Ethereum validator node with the Genesis block confirmation yesterday, December 1st. As also announced, the company has partnered with the Staked service provider to run the node.
Furthermore, they are preparing to increase their participation. The company has a balance of 32,407 ETH and 2,300 MKR. Additionally, they have stock in a crypto exchange called Wyre based in San Francisco, United States. In the statement the company stated:
Once we see the Ethereum 2.0 blockchain running stably over a period of time and are able to fully understand and mitigate the applicable risks, Ether Capital intends to make a more substantial commitment of its Ether balance to staking.
Ether Capital has staked the minimum of 32 ETH in the Ethereum 2.0 deposit agreement. The new PoS-based mechanism will allow validators to earn rewards for verifying transactions in the Beacon Chain and participate in network consensus. This way, they will be able to earn rewards for inflationary blocks. This reward, Ether Capital estimates, has an annual return of 16% based on the amount of ETH currently wagered. Brian Mossof, CEO of Ether Capital, said:
The launch of Ethereum 2.0 is an exciting and historic milestone in the digital assets space and we are thrilled to be part of it by managing a validator. The transition to staking has been part of the Ether Capital roadmap since its inception and means that Ether holders are now able to generate a yield, or yield, called Ether, by participating in validating the network.
Mythos Capital founder Ryan Sean Adams believes Ether Capital’s holding in Ethereum 2.0 is the start of a trend for institutional investors looking to gain exposure to ETH.
A publicly traded company now operates an Ethereum staking node
It won’t be the last
I predict that most Fortune 500 companies in the financial and tech sector will be operating staking nodes by the end of this decade https://t.co/tmEE4xPcg4
– Ryan Sean Adams – rsa.eth 🏴 (@RyanSAdams) December 1, 2020
New sources of demand for Ethereum (ETH)
Ryan Watkins, Messari researcher, highlighted the implications that the launch of Eth2 will have for the cryptocurrency. Watkins said “the introduction of staking” will give ETH “ownership of a capital”. Therefore, the asset will have characteristics of bonds and stocks. However, Watkins indicated that there is a fundamental difference between ETH and traditional assets:
(…) There is no risk of default (nominally) with an Ethereum bond. Ethereum can guarantee to pay stakers as long as the Ethereum blockchain remains alive because it pays stakers in its own currency. Unlike bonds that have maturity dates when bond holders receive their principal repayment, stakeholders can stake their ETH and receive a return forever.
The researcher concludes that the new asset features will be “a source of demand” for ETH. Therefore, the price of ETH could be positively impacted in the medium and long term.
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