Stake on Ethereum


Dawn enters the ETH staking landscape following Ethereum's transition from PoW to PoS in September 22, a significant milestone for open source development and blockchain technology. This transition, known as "The Merge," unifies two chains into a PoS network:

  • Ethereum PoW chain: Manages transaction settlements on the Ethereum chain.

  • Beacon chain: Ensures consensus through validator proposals and block finalization. Staking of assets occurs on the Beacon chain, serving as a safeguard against malicious actions by validators.

ETH holders with over 32 ETH can run a validator node on the Ethereum chain, securing the blockchain and earning staking rewards. Validator node operation involves running Ethereum clients on both PoW and Beacon chains. Presently, users staking ETH cannot unstake until the Shanghai upgrade in April '23.


Dawn's ETH liquid staking solution enables ETH holders to stake their assets using the ETH 2.0 staking interface. In return, users receive stkETH, following an exchange rate model where stkETH's value increases against ETH as it accumulates staking rewards.

Deposited ETH on the Dawn application goes to Dawn's issuer contract. Once the deposit contract reaches 32 ETH, a node operator is selected (first-come-first-serve) to run the validator node. The 32 ETH is staked with the chosen validator, and the pSTAKE protocol takes a 1 ETH refundable deposit from the Node Operator to ensure the withdrawal address aligns with the pSTAKE protocol pool.

Upon staking on the beacon chain, the oracle informs Dawn about the active ETH stake. Future application versions will have oracles monitoring validator performance and ETH staked balance, alerting about underperformance or slashing events.

In the event of slashing, the exchange rate is reduced, distributing the slashed amount among users. Dawn plans to launch a slashing risk mitigation mechanism in subsequent versions to minimize losses for end-users in slashing events.

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