The US subsidiary of Binance announced today that it will introduce an Ethereum (ETH) staking program ahead of the upcoming merge upgrade. The stakes program will have an Annual Percentage Yield (APY) of up to 6.0%.
Unlike direct betting on the Ethereum blockchain, which typically requires a minimum of 32 ETH to participate, Binance staking will only require a minimum of 0.001 ETH.
Commenting on the new development, Binance CEO Brian Schröder said:
“ETH plays a vital role in the broader Web3 ecosystem. As the Ethereum network continues to move towards merging, we are thrilled to offer ETH staking with some of the highest APY rewards in the industry.”
The staking yield of the program will be partially increased by features such as automatic restakes from Binance US that allow compounding of returns.
However, those who stake their ETH in Movement will not be able to withdraw ETH until Ethereum makes its first transaction on its Proof-of-Stake (PoS) blockchain after the merge upgrade.
The merge is scheduled for September 15th, although the higher Ethereum hash rate could result in an earlier upgrade than expected. Users will be allowed to withdraw their staked ETH from the Ethereum network following a further upgrade referred to as the “Shanghai Upgrade” depending on the successful completion of the merge upgrade.
However, due to the complexity of the upcoming merge upgrade, a smooth transition is not guaranteed and users’ funds are subject to risks such as long-term returns on invested funds or loss of funds in the event of the upgrade failing.