On April 24, Binance made an official announcement to rebrand ETH Staking 2.0 to ETH Staking and introduce Wrapped Beacon ETH (WBETH) on the ETH Staking service, effective from April 27 8:00 UTC.
WBETH is a new liquid staking token, similar to stETH of Lido Finance. 1 WBETH represents 1 BETH and the total staking rewards are accrued by the BETH token on ETH Staking after April 27 8:00 UTC.
BETH is a wrapped token issued by Binance which is 1:1 pegged to ETH on the Ethereum blockchain. This token has utilities: Once the ETH 2.0 upgrade is complete, users can use BETH to redeem ETH; and Binance will distribute staking rewards to user’s Spot Wallet daily based on BETH balance.
WBETH will allow users to participate in DeFi projects outside Binance, while ensuring their eligibility to receive the corresponding ETH Staking rewards accrued. The exchange is supporting users to wrap their BETH token to WBETH or unwrap their WBETH to BETH on the ETH Staking page for free.
The initial conversion rate between BETH and WBETH is 1:1, however, it can be changed as the value of WBETH will increase over time, in accordance with the daily APR on ETH Staking.
Binance will open deposits and withdrawals for WBETH on April 27 8:00 UTC and cease withdrawals for BETH starting from April 26 8:00 UTC. At this point, users can exchange 1 BETH for 1 ETH on the ETH Staking page.
For self-custody wallets, Binance will provide a smart contract to convert BETH to WBETH at a fixed rate of 1:1 on BNB Smart Chain. The exchange will also list spot trading pairs BETH/BUSD, BETH/ETH and BETH/USDT.
The liquid staking market is currently dominated by Lido Finance, with about 31% market share, according to statistics from Hildebert Moulie – a data scientist at Dragonfly Capital. A few days after the Shapella upgrade on Ethereum was successfully activated, Lido’s TVL has reached 6 million ETH or more than $12 billion. “Liquid staking has poised to benefit the most from the Ethereum Shapella upgrade. Liquid staked tokens offer greater capital efficiency and flexibility compared to staked tokens, as traders can earn staking rewards while retaining the ability to move their funds freely”, Bybit’s head of Crypto Insights, Charmyn Ho, told The Block last week.