Dubai investment firm stakes $10M in ETH
The firm’s investment will be carried out in partnership with CanETH
Dubai-based entrepreneur and the Chairman of the IBC Group Khurram Shroff has revealed that the investment firm is shelling out $10 million (approximately 20,000 Ether) for the upcoming launch of Ethereum 2.0.
This investment will be made in partnership with CanETH, an institutional-grade staking service for people that hold Ether, which will facilitate users who are participating in Ethereum 2.0.
CanETH is a Canada-based company that was co-founded by Dwain Pereira, a crypto miner from Canada, and Noman Qureshi, a Bitcoin Investor from Canada as well. The company functions as a decentralised global network that provides ETH2 staking for users.
Shroff has expressed his optimism for the Proof of Stake concept that is being proposed for the Ethereum 2.0 smart contracts.
“The greener and more efficient version being introduced in the second iteration addresses the unsustainably high energy consumption required by the ‘Proof of Work’ model, making it even more attractive”, Shroff explained.
The founder of Ethereum, Vitalik Buterin, previously announced that the date for the Genesis launch has been set on 1 December of this year. It will require 16,384 validators to stake 524,288 ether into the contract (this is equivalent to roughly $230 million) for the Ethereum 2.0 platform to go live.
Should this level of participation be achieved, the staking rewards are around 25 per cent APR.
For many crypto enthusiasts, staking is seen as a preferable approach to supporting blockchain networks as opposed to energy-intensive mining. The Proof of Stake network gives investors the opportunity to commit funds for a short period of time in return for rewards, and staking pools are a way for investors to be involved even if they do not have 32 ETH to stake for a validator.
Dwain Pereira from CanETH explained how the Proof of Work blockchain model can be more taxing on cryptocurrencies.
“The Proof of Work blockchain model uses more electricity than some countries. These exorbitant energy costs are eventually paid using fiat currencies, which creates downward pressure on the value of the cryptocurrency. So the Proof of Stake model will be both energy efficient and more lucrative for stakers”.
Shroff has expressed his belief that blockchain is a part of the “promise to transform virtually all human interactions and transactions”. Now that Ethereum 2.0 allows for operation with a decentralised “distributed consensus” model, it is expected that the environmental concerns associated with previous models will be addressed and that blockchain applications will become more widespread.