What is Liquid Staking? How to be an Ethereum validator with less than 32 ETH?

TL;DR:

What is Liquid Staking in 90 Seconds?

https://lenstube.xyz/watch/0xf5b2-0x014b-DA-b52ee73d

What is Liquid Staking?

Liquid Staking is a form of staking where a user can access their locked tokens for activity across different networks while you are still earning rewards from the original deposits.

What are Liquid Staking Derivatives?

Liquid Staking Derivatives (LSDs) are the liquid derivative tokens that represent the underlying value of the ETH you staked in the pool. If you put in 1 ETH, you will get 1 ETH liquid derivative token.

Why do we need Liquid Staking?

There are several reasons why liquid staking is becoming increasingly popular, particularly because it enables more investors or small holders of ETH to participate in earning rewards as well.

Liquidity: Traditional staking locks up tokens for a set period of time, which can limit their liquidity. Liquid staking allows users to earn staking rewards without sacrificing liquidity, as the tokens remain available for trading or other purposes.

Flexibility: With Liquid staking, users can stake their tokens and still use them for other purposes, such as collateral for loans or trading on other platforms. This increases the flexibility and utility of staked tokens.

Accessibility: Liquid staking also makes staking more accessible to a wider range of users. Traditional staking may require a large amount of capital to participate, but liquid staking can allow users to stake smaller amounts of tokens.

Network Security: Staking is an important part of securing blockchain networks, and liquid staking can help increase the number of tokens being staked, which can lead to a more secure network.

Can I run my own Ethereum validator if I don’t have 32 ETH?

The answer is yes. Even if you don’t have 32 ETH, you can still help decentralization by running the hardware and software yourself. You can also leverage ETH from Staking Pools and have it staked in your machine and earn revenue from it. This is called being a Node Operator for one of these pools.

There are a few options to do this today and Rocket Pool is the #1 leader for liquid staking node operators with over 2,000 in early 2023.

Lear more about Node Operators via the links below: