StakeWise Pool

Tokenized ETH staking pool targeting maximum rewards for stakers

The goal of the StakeWise Pool is to enable holders of ETH to earn maximum staking rewards from participating in the Ethereum 2.0 consensus mechanism and allow them to utilize their stake in various DeFi protocols with help of StakeWise tokens.

We apply a 10% commission on rewards that the Pool generates to compensate for the costs of developing, running, and maintaining the infrastructure and smart contracts that underpin the StakeWise platform. To our knowledge, this is the most competitive offer on the market, which underscores our commitment to helping users maximize their staking returns while maintaining the highest level of service.

Overview

StakeWise Pool is a network of validators created and operated by StakeWise on behalf of stakers using ETH deposited into the Pool. For each new block of 32 ETH collectively deposited by the users, a new validator is created and added to the StakeWise Pool to earn rewards. All rewards and penalties generated by the Pool are distributed among stakers pro-rata according to their share of the Pool. The balance of ETH deposits and rewards is reflected in stETH (staking ETH) and rwETH (reward ETH) minted to stakers in a 1:1 ratio.

Depositing

Anyone can deposit any amount of ETH into the StakeWise Pool. Upon each new deposit in the Pool, StakeWise mints an equal amount of stETH (ie 1 ETH = 1 stETH). Newly minted stETH will start accruing rwETH immediately, even if the deposit is not part of a new validator yet.

Deposited ETH first goes to the Pool contract, where it sits with other small deposits until it collects a total of 32 ETH required for a new validator.

Once the Pool contract collects 32 ETH, it sends them to the validator registration contract (VRC). VRC registers a new validator entity on the Beacon Chain. Simultaneously, StakeWise Pool adds the new validator to its network. After progressing through an activation stage in the Beacon Chain, the newly created validator starts earning rewards for stakers in the StakeWise Pool. For every ETH earned as a reward by the Pool, StakeWise mints an equal amount of rwETH. It is accrued to the holders of stETH every hour (in Medalla).

Tracking earnings

Your earnings from staking in the Pool can be tracked by looking at the amount of accrued rwETH or by consulting the dashboard within the StakeWise Pool section of the app.

At the later stages, StakeWise will add a dedicated Statistics page to show the most important KPIs for the StakeWise Pool and the Ethereum 2.0 network as a whole.

Withdrawal

Upon the arrival of Phase 2, StakeWise users will be able to burn stETH and rwETH within the app and receive ETH in return at a 1:1 ratio.

Stages of deposit utilization

Every deposit into the Pool will pass through the two stages of utilization, whose length and relative size will temporarily affect the yield of the Pool. These stages are Activating and Staking.

Activating

Newly registered deposits enter the activation queue to start staking in the Ethereum 2.0 network. The length of the activation queue depends on the amount of ETH being simultaneously registered in the network during a certain period. If the amount is large, it can take the network several days to activate all queuing ETH.

ETH that is stuck in the activation stage is labeled as Activating in the StakeWise Pool. The amount of Activating ETH can cause a temporary drag on the Pool's performance, especially at the moment of StakeWise's and Phase 0 launch. This is because stETH starts accruing rewards immediately, whereas activation of deposited ETH may take days. However, the size of the drag is negligible:

  • 0.05% (9.95% APR) on a full-year basis with 10 days activation period

  • 0.16% (9.84% APR) on a full-year basis with 30 days activation period

  • 0.33% (9.67% APR) on a full-year basis with 60 days activation period

all assuming 10% APR before the drag and having 20% of total ETH deposits in the Pool as Activating.

In practice, the activation period is unlikely to exceed 10 days even during the first months following Phase 0 launch when most stakers will start joining the network. Hence, the drag from Activating ETH will be minimal.

Staking

Once ETH in the registered validator gets activated by the network, it proceeds to staking and starts earning rewards for the Pool. At this stage, there is no discrepancy between the amount of ETH earning staking rewards and stETH, and hence there is no drag on the yield of the Pool.

Effects of staging

The effect from Activating ETH will be the most pronounced during launch and other periods when many new validators are being registered at once. Despite a temporary drag to the staking yield that emerges in periods of mass inflow of new deposits in the Pool, the long-term benefits to stakers in the Pool are much higher due to the expected increase in the liquidity of stETH and rwETH associated with rising deposits in the StakeWise Pool.