1. Liquid Staking - How does it work?
Liquid Staking is an additional feature to Crypto Staking, where users can wrap their Staked virtual assets and receive a receipt token that continues to benefit from accruing staking rewards . This provides users with access to their funds while their virtual assets are still staked. Crypto.com currently offers liquid staking for ETH.
2. What is CDCETH?
Crypto.com Staked ETH (CDCETH) is a receipt token representing your staked Ether (ETH) and any accrued staking rewards.
The conversion rate represents the rate at which Crypto.com will wrap your staked ETH to CDCETH or unwrap your CDCETH to staked ETH. We do not charge any fees for both the wrapping and unwrapping process.
While Crypto.com currently does not support transfer/withdrawals of CDCETH, this functionality is being developed. Once available, you can withdraw CDCETH to a third-party wallet or to transfer a different account within Crypto.com.
Read CDCETH whitepaper here.
3. How do I wrap and unwrap CDCETH?
You can wrap staked ETH to CDCETH at ETH staking details page under Staking > My Portfolio in Crypto.com App or choose “Wrap/Unwrap” at CDCETH crypto wallet.
Staked ETH can only be wrapped for CDCETH when your staking transaction status has changed to ‘Staked’ after the ‘Activation’ period ends. Staked ETH undergoing unbonding is not eligible for wrapping.
Your CDCETH balance is reflected on your Crypto Wallet. CDCETH can be unwrapped to staked ETH at any time based on the prevailing conversion rate.
Crypto.com does not charge any fees to facilitate either process.
4. What is the conversion rate for wrapping and unwrapping CDCETH?
The conversion rate determines:
The number of CDCETH you will receive when you wrap staked ETH
The number of staked ETH you will receive when you unwrap CDCETH
The conversion rate changes as a result of the rewards earned on the staked ETH by CDCETH holders. As the conversion rate accounts for staked ETH and the accrued staking rewards since the introduction of CDCETH, it is likely to increase over time*.
The conversion rate will be displayed when you initiate a new request to wrap staked ETH or unwrap CDCETH*.
*Please read the Staking Terms and Conditions carefully in relation to the risks of ‘slashing’, which may occur when the transaction validator representing those assets incorrectly validates or fails to validate a transaction. Slashing typically involves the reduction or confiscation of a validator’s assets as a consequence of their improper actions. As a result, validation rewards may not be paid out, and the staked virtual assets might also be lost and/or subject to a penalty fee which can adversely impact the conversion rate. In the unlikely event that the conversion rate changes by more than 5 bps after you have initiated wrapping and unwrapping, your wrapping/unwrapping request will be rejected.
5. Will I receive rewards by holding CDCETH? How does it defer from holding staked ETH?
When you stake ETH on Crypto.com, and hold ETH (Staked) in your account, you receive staking rewards on your staked ETH on a regular basis, based solely on the blockchain protocol.. These staking rewards are credited to your ETH crypto wallet. However, please note that staked ETH cannot be withdrawn from your account until you have initiated an ‘Unstaking’ request and that ‘Unstaking’ request is complete.
CDCETH holders are entitled to rewards as well. However, this will be disbursed through the increase in the conversion rate of CDCETH to staked ETH instead of receiving ETH rewards directly in their accounts. CDCETH holders can redeem their rewards by first unwrapping their CDCETH, where they will then receive staked ETH based on the conversion rate at the point of unwrapping. Since the conversion rate changes as a result of the rewards earned, over time, the user will receive more staked ETH when they unwrap their CDCETH.
6. Trading of CDCETH
CDCETH is a tradable receipt token representing your staked ETH and any accrued staking rewards. The trading of the CDCETH on Crypto.com platforms is subject to jurisdictional limitations due to potential or actual regulatory restrictions. For further information on the eligibility of CDCETH trading in your jurisdiction please contact your Crypto.com App relevant entity
7. How do I convert my staked ETH to ETH?
Once your ETH is staked through Crypto Staking, there are two ways you can receive back your staked assets in ETH.
You may unstake Staked Balances* by initiating an ‘Unstaking’ request and receiving the equivalent amount of the native virtual asset [e.g., Unstake 1 ETH (Staked) and receive 1 ETH]. Please note that:
Users may only receive their ETH after the protocol-imposed on-chain unbonding period ends.
You may wrap Staked Balances* for CDCETH at the listed conversion rate anytime.
*This refers only to Staked Balances where the staking transaction status has changed to ‘Staked’ after the ‘Activation’ period ends. It does not include assets which are under either the ‘Activating’ or ‘Unbonding’ status.
8. Who can participate in Liquid Staking?
Verified Crypto.com App users who are not citizens or residents of the following jurisdictions are eligible to Liquid Staking feature:
The United States of America and its territories
Hong Kong SAR
Note: Crypto.com reserves the sole discretion to restrict liquid staking from certain users at any time for legal, regulatory or any other reasons.