Tokenized Staked ETH Will Replace ETH

Oct 14, 2020 at 09:00 UTCUpdated Oct 14, 2020 at 11:42 UTC.Tokenized staked ETH is going to replace ETH itself.

This tokenized version of ETH will perform all the same functions of ETH, but it will also be more valuable, because it will earn staking rewards and can simultaneously do other things.

DeFi is, after all, Ethereum's killer app so it would actually be unthinkable to keep staked ETH from the DeFi world.

Rather than remain on its own, separate island, staked ETH will inevitably be tokenized and form the bridge that will bring Ethereum 2.0 across to its killer app.

We have seen this staked tokenization play out with other cryptocurrencies such as DAI - the first important token in the DeFi space.

Staked ETH will be far more significant because there is so much more of it and it represents way more value.

It is positive in three key ways: now users will be able to secure the Ethereum network by staking, earn yield for doing so, and have the ability to use that ETH as yield-generating collateral elsewhere.

The security ramifications are significant for Ethereum because staked ETH creates additional incentives to stake ETH and simultaneously participate in DeFi activity.

This is why we should expect tokenized staked ETH. Staked ETH indeed does have to remain locked away until further Ethereum 2.0 developments.

Staked ETH will be tokenized and will replace ETH. It is not a case of if, but when.