Beacon ETH or BETH is a token that stands for staked ETH. Each BETH equals 1 staked ETH on Binance. You might wonder, isn’t Ethereum using Proof of Work (PoW) right now? Yes, it is. But with ETH 2.0, Ethereum will eventually move to Proof of Stake (PoS).
The upgrades are complex, so they are being rolled out in different phases. The initial phase involved launching the Beacon Chain, which will be essential to Eth2 once sharding is fully in place. The Beacon Chain is already operational, and as of March 2021, it has over 3.5 million ETH securing it.
Users can only deposit into the Beacon Chain contract, but they cannot withdraw until ETH 2.0 is fully launched, which could be a long time. Also, deposits must be made in multiples of 32 ETH.
The Beacon Chain rewards all ETH with staking rewards. If you don’t have 32 ETH or want flexibility to withdraw, you can join an ETH 2.0 staking pool like the one offered by Binance.
You can change your ETH to BETH at a 1:1 rate and begin earning staking rewards in BETH. That’s good, but if you want to use your ETH for other things, Binance offers a BETH/ETH spot market, allowing you to switch your BETH back to ETH.
How to use BETH?
There are multiple ways to utilize BETH. You can choose to hold it on Binance for staking rewards or transfer it to BNB Smart Chain (BSC) for DeFi applications. Explore the various possibilities available.
Beacon ETH vs. ETH
When you check the WBETH/ETH market on Binance, you’ll notice that BETH does not have a 1:1 value with ETH, even though one BETH stands for one staked ETH. The reason is simple: they are different assets. The market determines the price difference between BETH and ETH. Keep in mind that BETH is a tokenized form of staked ETH.
BETH has different effects than ETH. The market values its qualities differently, as shown by its different price. BETH cannot be exchanged for ETH, making it less flexible. However, it does entitle the holder to staking rewards.
Conclusion
BETH is a tokenized form of staked ETH on Binance. You can receive rewards for staking ETH 2.0 without needing to handle the technical aspects of setting up and managing an ETH 2.0 staking node. Additionally, there are various methods to earn extra returns through DeFi applications on the BNB Smart Chain.