Upside/Downside of ETH2 staking (and APR) over traditional savings

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Upside/Downside of ETH2 staking (and APR) over traditional savings

I'd be interested in hearing the perspective of others regarding the upside or downside of putting a significant amount of my savings into ETH2 staking and earning 6% APR as opposed to leaving it in a traditional savings account.

I currently have a traditional online savings account where I've parked enough money to give me roughly 1 year's worth of savings. I'm currently earning .5% interest (down from 2.5% when I signed up thanks to the pandemic and falling interest rates).

Recently, I started dollar-cost-averaging into Ethereum and was then given the chance to stake my ETH in ETH2 through Coinbase. I'm getting 6% APR at the moment which is obviously a ton better than my savings account. I'm fortunate to have a very stable job where I'm not in any jeopardy of getting laid off/fired and I don't have any plans that I would need a significant amount of money for in the next 6-9 months.

I'm also a believer that the price of ETH is going to continue to rise, especially when the new protocol upgrades and EIP 1559 are released.

So, I'd like to hear some perspective from others in terms of the upside/downside of staking some portion of savings in ETH2 in order to benefit from the increased interest rate and the overall rise (hopeful… of course this is not guaranteed) in ETH. What are the downsides to doing this (such as not being able to use the funds until ETH2 is released, potential fall in the price of ETH, etc)?

submitted by /u/trevorsc19
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