EtherFi Secures $5.3 Million to Launch Innovative Decentralized Liquid Staking Initiative
In Brief
EtherFi empowers stakers to maintain sovereignty over their keys while outsourcing validator tasks to a designated node operator.
An NFT is generated for every validator that gets deployed through the EtherFi platform.
These NFTs have the potential to create a programmable framework on top of the existing staking infrastructure.
The liquid staking platform EtherFi has raised $5.3 million in a funding round led by North Island Ventures and Chapter One, with participation from Node Capital, Arrington Capital, Maelstrom, Version One Ventures, Purpose Investments, and several other investors.
Unlike other delegated staking protocols where stakers are paired with a node operator who manages and protects the staking credentials, EtherFi's approach enables stakers to generate their own ETH keys while delegating validator responsibilities to a node operator.
This model grants users full oversight of their assets, thereby mitigating the risk of centralized control. For each validator launched through the protocol, an NFT is created, and the Liquid Staking Derivative token eETH is minted from a liquidity pool containing these NFTs. Participants can engage in staking by minting eETH, which is exchangeable for ETH at a 1:1 ratio.
According to EtherFi, stakers who deposit at least 32 ETH will receive an NFT that signifies their economic stake in the validator. These NFTs govern the 32 ETH that has been staked and house pertinent metadata regarding the validator, including the client they operate, geographical location, node operator, and any services they provide. In turn, these NFTs facilitate the creation of additional programmable functionalities atop the staking framework.
"Ether.fi is dedicated to upholding the decentralized ethos of the cryptocurrency ecosystem. To maintain the integrity of these principles within the crypto community, it is vital that we all persist in educating others and reinforcing the values and rationale behind Web3 ideals,\"
Node Capital wrote in a blog post .
EtherFi was established by Mike Silagadze in October 2022 after leading the educational software firm TopHat for 12 years and launching the crypto DeFi fund Gadze Finance in 2021. The raised funds will be allocated towards growing the team and forming new strategic alliances.
The liquidity staking protocol is set to debut on March 4 during ETHDenver, right after the successful Ethereum Shapella upgrade on the Sepolia testnet. This launch is well-timed with the much-anticipated Shanghai upgrade, which is expected to occur on the mainnet in March, allowing ETH stakers to withdraw their staked assets and any accrued rewards.
This Friday at ETHDenver, EtherFi will host a complimentary event, co-sponsored by its collaborator, Kiln, a sophisticated staking platform. Attendees will have the chance to listen to Silagadze discuss EtherFi at 7 PM and network with a diverse group of Ethereum experts, including venture capitalists, node operators, and veterans from the staking sector. launch party Top 5 NFT Staking Ventures for 2022: Advantages and Disadvantages
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Disclaimer
In line with the Trust Project guidelines Cindy is a journalist at Metaverse Post, specializing in web3, NFT, metaverse, and AI topics, focusing on interviews with Web3 industry leaders. She has engaged with over 30 C-level executives and counting, sharing their invaluable insights with readers. Originally from Singapore, Cindy has made Tbilisi, Georgia, her home. She holds a Bachelor's degree in Communications & Media Studies from the University of South Australia and boasts a decade of experience in journalism and writing.
