Coinbase Launches Custom Crypto Asset As Ethereum Merge Approaches
Top US-based crypto exchange platform Coinbase is launching a custom crypto asset ahead of Ethereum’s (ETH) upcoming merge to a proof-of-stake mechanism consensus.
Coinbase says it is launching Wrapped Staked Ethereum (cbETH) so customers can have the ability to use their Staked Ethereum (ETH2) on the platform as The Merge will lock all ETH2 in place until the update is complete.
“Coinbase is allowing customers who stake ETH to receive an ERC20 utility token called Coinbase Wrapped Staked ETH (cbETH), which is a liquid representation of their staked-ETH.
All staked-ETH is locked until a future Ethereum protocol upgrade is complete. In the meantime, Coinbase has created cbETH to give customers the option to sell, transfer, spend, or otherwise use their staked-ETH while it remains locked.”
The ETH-based altcoin, which is a liquid, tradeable asset given to investors who staked their Ethereum on Coinbase, can be sold or sent off-platform but cannot be used on other blockchain networks, warns the crypto exchange.
“Do not send this asset over other networks or your funds will be lost.
Coinbase Wrapped Staked ETH (cbETH) is a utility token that represents ETH2, which is ETH staked through Coinbase. cbETH can be sold or sent off-platform, while ETH2 will remain locked-up until a future protocol upgrade.”
Coinbase says that the ability to wrap ETH2 will be progressively rolled out to eligible users throughout the day. The crypto exchange also notes that cbETH is not meant to track Ethereum’s price 1:1.
“The price of cbETH is NOT meant to track the price of ETH 1:1. cbETH represents staked ETH plus all of its accrued staking interest, starting from when cbETH’s conversion rate and balance were initialized (June 16, 2022).”
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Author: Daily Hodl Staff
