Summary

BETH is the tokenized version of staked Ethereum (ETH) on Binance. This is an easy way to participate in staking on the Ethereum 2.0 beacon chain. As a BETH holder, you are entitled to earn staking rewards through Binance’s Ethereum 2.0 staking nodes. But that's not BETH's only use. There are multiple other ways BETH can be used on the Binance platform and Binance Smart Chain (BSC).

Introduction

With the official launch of the beacon chain in December 2020, a series of projects aimed at improving the The upgrade measures for scalability of Ethereum (Ethereum 2.0) are also on track. Ethereum is already available for staking on this new chain as part of Phase 0 of the deployment plan. BETH allows users to easily participate in Ethereum staking, while also being flexible and supporting the withdrawal of Ethereum at any time.

What is BETH?

BETH is a tokenized version of staked Ethereum (ETH). Each BETH represents 1 Ethereum staked on Binance. You may ask, doesn’t Ethereum run on Proof of Work (PoW)? This is indeed the case for now. However, as part of ETH 2.0, Ethereum will fully switch to Proof of Stake (PoS).

Due to the complexity of this upgrade, it will be rolled out in multiple stages. The first step is to launch the so-called "beacon chain". After sharding is fully implemented, it will become the core of ETH2.0. The beacon chain is running smoothly. As of March 2021, its security has been guaranteed by 3.5 million ETH.

The deposit contract of the beacon chain can only work in one direction. This means that users can deposit money normally, but they will not be able to withdraw money until Ethereum 2.0 is fully launched - a process that could take years. Additionally, they can only make deposits in units of 32 Ethereum.

All of this Ethereum in the Beacon Chain has received staking rewards. So, what should you do if you don’t have 32 Ethereum or want to withdraw cash flexibly? You can join any Ethereum 2.0 staking pool, Binance also has one.

The Ethereum held can be converted into BETH at a ratio of 1:1, and then the BETH pledge reward can be obtained. That’s great, but what if you want to use Ethereum elsewhere? Binance has also set up a BETH/ETH spot market where you can convert BETH to ETH again.

How to use BETH

BETH has many uses. You can store it on the Binance platform and enjoy staking rewards. You can also withdraw BETH to Binance Smart Chain (BSC) and use it in DeFi App. Let’s take a look at other ways to use it.

BETH in Binance New Coin Mining and Liquidity Mining

If you choose to save BETH on Binance, you can earn additional rewards through it . For example, new coin mining (Launchpool) projects sometimes use BETH as a recharge token. Simply lock your BETH holdings into Launchpool to earn the newly launched token, which will receive instant liquidity from the Binance spot trading platform.

BETH in Binance Liquidity Mining

BETH can also be used in Binance Liquidity Mining. For example, there are rewards for injecting liquidity into the Ethereum/BETH liquidity pool. Note that you can add Ethereum and BETH to the liquidity pool. There is no fee if you add both tokens at the same time.

BETH in Lending Agreement

Another option is to deposit BETH in the money market (e.g. Venus) to earn income or use it as collateral to borrow other tokens.

BETH in PancakeSwap

You can also provide liquidity to the BETH/ETH trading pair and receive CAKE in PancakeSwap. Note that PancakeSwap works similarly to Uniswap, you will also need the tokenized version in Binance Smart Chain (BSC) to provide equal value for both tokens.

BETH and Ethereum are at the same or very similar prices, so a big advantage of injecting liquidity into the above pools is the lower risk of impermanent losses compared to other pools. If you don’t understand what impermanent loss is, please read our introduction article on impermanent loss.

In short, this pool is less affected by impermanent losses because the relative volatility between BETH and Ethereum is much lower than that of a trading pair like Ethereum and BUSD. In other words, the prices of Ethereum and BETH usually remain within a small range, and the impact of impermanent losses is relatively mild.

BETH in Yield Aggregator

Finally, you can also add in any Yield Aggregator on Binance Smart Chain (BSC) Use BETH. Deposit BETH into the income aggregator and the protocol will automatically find the best income opportunities. Beefy and Autofarm are two examples that support BETH.

Is BETH more valuable than Ethereum?

Binance’s BETH/ETH market data shows that even though 1 BETH represents 1 pledged Ethereum, BETH and Ethereum cannot be traded at a 1:1 ratio. how so? In short, they are not the same type of assets. Price discovery between BETH and Ethereum is entirely determined by the market. Don’t forget, BETH is a tokenized version of staked Ethereum (ETH).

Therefore, the meaning of BETH is different from that of Ethereum. The fact that it trades at a different price than ETH suggests that the market is pricing its quality differently than Ethereum. Currently, BETH cannot be exchanged for Ethereum, indicating that it is not as flexible as Ethereum. But at the same time, it gives holders the right to obtain staking rewards.

Summary

BETH is the tokenized version of staked Ethereum (ETH) on Binance. You can easily earn Ethereum 2.0 staking rewards without worrying about the technical requirements of setting up and maintaining an Ethereum 2.0 staking node. In addition, there are many ways to use DeFi App to obtain additional benefits on Binance Smart Chain.