Staking Ethereum

What is Ethereum 2? 

Ethereum 2 (ETH2) is an upgrade to the Ethereum network that aims to improve the network’s security and scalability. This upgrade involves a shift in Ethereum’s mining model (“Proof-of-Work”) to a staking model (“Proof-of-Stake”). 

What’s the difference between Ethereum (ETH) and Staked ETH on Coinbase?

Coinbase offers our customers the ability to stake their ETH to earn rewards. When you stake your ETH, it converts to Staked ETH on Coinbase. The price of Staked ETH is identical to ETH. Once the upgrade to the Ethereum network is complete, both ETH and Staked ETH will integrate into one token.

What is staking?

Staking is the process of actively participating in transaction validation (similar to mining) on a Proof-of-Stake blockchain. On these blockchains, anyone with a minimum-required balance of a specific cryptocurrency can validate transactions and earn staking rewards. Learn about how staking works on Coinbase and how to stake ETH.

What are the rewards associated with staking ETH?

You may earn rewards on any ETH that you stake in exchange for helping secure the network. ETH staking rewards are given in accordance to how much ETH is validated and what rewards the network is offering over a time period. When there is very little ETH staked, the protocol rewards will be larger as an incentive for more ETH to come online. As an increasing amount of ETH is staked, the reward is reduced. View the current amount of ETH staked.

Are there risks associated with staking ETH? 

ETH staking is offered under the terms and conditions of our User Agreement and any additional terms that may be presented at the time you choose to stake. ETH staking is experimental and involves some risks including possible failure of the network. Please ensure you independently assess, understand, and accept the related risks before deciding to stake.

An important risk to be aware of is the possibility of losing your staked assets due to slashing. Slashing is a penalty enforced at the protocol level associated with a network or validator failure.  

Coinbase has taken measures to minimize the risk of slashing. However, slashing can be caused by events outside of our control that could lead to the loss of staked ETH. If you started staking prior to August 30, 2021, Coinbase will replace any ETH lost to slashing at no additional cost. If you started staking your ETH after August 30, 2021 or wrap your staked ETH for cbETH, some conditions apply—please see the User Agreement for details.

Is there a staking minimum and maximum?

There are no minimums to stake on Coinbase. There is a maximum amount of ETH that each user can stake to help manage network limits. This maximum amount will change over time and is not specific to your individual account.

What are the eligibility requirements to stake ETH?

To be eligible to stake ETH, you must: 

• Hold ETH in your Coinbase account.

• Live in a jurisdiction eligible for ETH staking.

• Complete identity verification.

• Complete ID document verification.

• Read and understand the terms and conditions associated with ETH staking.

Important: Only individual accounts are eligible for staking—not business accounts.

Which regions are eligible for ETH staking?

How do I start staking ETH on Coinbase?

Go to the Ethereum asset page under your Portfolio on web or mobile and follow the respective prompts. If you're signed in and eligible (see eligibility requirements above), you may be able to convert your ETH to Staked ETH and start staking. 

If you’re experiencing issues with staking on the Coinbase mobile app, please make sure you’re using the latest version.

Will I be able to use my funds while I’m staking ETH?

Yes, Coinbase has introduced a token called cbETH (Coinbase Wrapped Staked ETH) that lets you sell, send, or use your staked ETH position. This utility token represents staked ETH at Coinbase and you will continue to benefit from staking rewards while holding the token. There are no fees to wrap your initial staked ETH or rewards into cbETH. cbETH is available in select regions. You can learn more about cbETH here.  

Where can I view my staked ETH?

Your ETH will appear in your Staked ETH balance when you decide to stake. If you wrap your staked ETH to trade it or use it off-platform, then it will appear in your cbETH balance.

Where can I view my staking rewards? 

ETH staking rewards will be reflected in your Staked ETH balance and under 'Lifetime Rewards' and will be added to your account on a regular basis. 

If you wrap your staked ETH into cbETH, you will still earn rewards, but not directly through Coinbase. Instead, the price of the cbETH utility token is intended to reflect the price of the underlying staked ETH plus any accrued rewards. Learn more about cbETH here.

What are the tax implications of staking ETH?

It's the user’s responsibility to determine what taxes, if any, arise from participating in the ETH staking service. US customers who earn at least $600 in income from Coinbase may receive a 1099-MISC from Coinbase. You can learn more about the 1099-MISC on the official website of the IRS.

Can I stake funds stored in a Coinbase vault?

You can't currently stake your funds directly from a vault. You’ll need to move your funds from your vault into your ETH balance in order to stake.

When will my rewards be paid out?

Your first rewards payout should appear a few days after each purchase or transfer. After that, you will receive regular payouts of the ETH staking rewards that will be added to your balance every 3 days.