Ethereum 2.0 or Eth2, is an upgrade to the Ethereum network. The Ethereum Merge is migrating Ethereum from the current Proof-of-Work network to a new Proof-of-Stake blockchain, Eth2 aims to increase scalability and reduce energy consumption.
As a Proof-of-Stake blockchain, the Eth2 Beacon Chain is built and secured by the network's validators. To participate as a Beacon Chain validator, you must stake ETH by sending it to a deposit contract on the Ethereum network. When you stake through Kraken, we will credit your account with staked ETH and the applicable staking rewards consistent with our Terms and the rules of the Ethereum network.
Review frequently asked questions within the sections below:
General
Staking
Reward rates for your staked ETH are currently estimated between 4% and 7% annually (RPY), and these rewards are locked in your account as ETH2. These rewards will continue after the merge.
After the merge, Kraken will also collect additional rewards payable to stakers. This includes tips paid to Kraken’s validators as a result of fee activity on the Ethereum network and for MEV activity. Kraken uses market leading software to maximize the rewards payable to stakers and shares this with our customers in the same way as inflationary staking rewards. These new rewards will be issued to your account as unstaked ETH, fully unlocked and able to stake, trade or withdraw in your account.
Kraken will continue to distribute rewards on a variable rate that reflects what we’ve earned On-chain minus our fee. Rewards will vary according to the rules of the Ethereum protocol.
Unlike regular Proof-of-Stake protocols, staked ETH and ETH staking rewards will be locked until the Shanghai upgrade is complete. This limitation is not specific to Kraken - it is a limitation on the Ethereum network itself. In the event the Eth2 network upgrade is delayed or cannot be completed, you may be unable to access, withdraw or transfer your staked ETH and locked rewards On-chain indefinitely.
After The Merge, Kraken will also collect additional rewards payable to stakers. This includes tips paid to Kraken’s validators as a result of fee activity on the Ethereum network and for MEV activity. Kraken uses market leading software to maximize the rewards payable to stakers and shares this with our clients in the same way as inflationary staking rewards. The additional rewards will be issued to your account (estimated to begin on September 25th 2022 after 01:45 UTC) as unstaked ETH, fully unlocked and able to stake, trade or withdraw in your account.
Kraken will continue to distribute weekly rewards on a variable rate that reflects what we’ve earned On-chain minus our fee. Rewards will vary according to the rules of the Ethereum protocol.
Trading
No, Japanese residents cannot trade staking ETH (ETH2.S).
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ETH |
The ETH ticker on Kraken represents “regular” ETH: ETH on the Ethereum blockchain that has neither been staked nor earned as staking rewards. It can be staked, deposited, traded and withdrawn. |
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ETH2.S |
The ETH2.S ticker on Kraken represents ETH that has been staked to support the Eth2 network upgrade. Clients that are not located in or citizens or residents of the US or Canada may transact on Kraken’s ETH2.S/ETH. Otherwise, ETH2.S cannot be un-staked, deposited or withdrawn. |
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ETH2 |
The ETH2 ticker on Kraken represents ETH that is earned as staking rewards through Eth2 staking. ETH2 cannot be staked, deposited, traded or withdrawn. |
If you have any additional questions, our support specialists are available to assist you.