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A Dubai investment firm is staking $10 million worth of ETH to support the Eth2 launch

A Dubai investment firm is staking $10 million worth of ETH to support the Eth2 launch

IBC Group, a Dubai-based boutique investment firm, is staking $10 million worth of ether (ETH) to support the Ethereum 2.0 launch.

The firm has partnered with Canada-based staking service CanETH for the initiative. Specifically, IBC will stake a total of 21,984 ETH, in three tranches, for 687 validators.

Khurram Shroff, chairman of IBC’s board, said the firm is “very excited” for Eth2, i.e., when the network transitions from a proof-of-work system to a proof-of-stake mechanism. The ETH lockup “shows our confidence in ETH2 and dedication to the beacon chain,” said Shroff.

Eth2 is expected to go live on December 1, with the launch of Beacon Chain, when at least 524,288 ETH is staked in the Eth2 staking deposit contract.

So far, however, only 101,216 ETH has been deposited in the contract. ETH holders are probably waiting to deposit until the last days to avoid opportunity costs. In other words, ETH holders have little incentive to lock their ETH now when they can utilize it for other activities, such as lending to earn yield or use it as collateral for trading.

Eth2 stakers can withdraw their stake only when Ethereum fully transitions to a proof-of-stake system, or once the Ethereum mainnet becomes a shard, which is expected to happen sometime in 2021.

© 2020 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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Author: Yogita Khatri