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How to stake ETH with Lido on Layer 2

The low cost way to earn daily rewards on your ETH

Edward Wilson
Jan 5, 2022

Lido lets you earn a return on your ETH - currently around 4.86% APY. Our Layer 2 integration lets you do this much more cheaply than using Layer 1. Here's a quick overview.

What is Lido?

Lido lets people easily stake, i.e. deposit assets, on Ethereum 2.0. Staking secures the ETH 2.0 network, and the rewards are an incentive for people to participate.

Lido simplifies the entire staking process and lets you withdraw at any time. There’s currently over $6 billion being staked via Lido on Ethereum.

Argent integrated Lido on Layer 1, but our new zkSync integration gives you access for a fraction of the network fees.

How to stake ETH in Argent

It couldn’t be easier to stake ETH with Lido in Argent on zkSync:

  1. Tap ‘Invest’ 
  2. Tap ETH within ‘Earn on tokens you hold
  3. Select ‘Staking
  4. Enter the amount of ETH you would like to invest
  5. Tap ‘Review
  6. Tap ‘Invest now

Once the transaction has been completed you’ll receive a token that represents your investment. The token is called wstETH (wrapped Staked ETH).

Using Lido on Layer 2 with Argent

Fees

Lido takes a 10% fee which is already accounted for in the yield you get.

As we are using pooling to bring liquidity from L1 to L2, you pay a small gas fee to cover your share of the L1 transaction needed to rebalance the pool.

There are also zkSync network fees which will cost no more than a couple of dollars.

Further information

Risks

As always in crypto and DeFi, you should do your own research before using a product. These include smart contract vulnerabilities and the economics of the protocols involved. Lido’s audits can be found on their homepage and they list further risks in their FAQs.

Calculating APY

The percentage return on staked ETH will depend on the total staked ETH in the network. APY decreases when the total amount of staked ETH is increased. The current APY will always be shown in the Argent app. 

Please also note that wstETH isn't 1:1 to ETH, meaning if you do decide to sell your wstETH you'll get the around 99% of the value which would be the market rate. This is because Ethereum 2.0 withdrawals are not live yet. For more on this, read Lido's explainer.

With zkSync 1.0 you can't have a rebasing token (a token where your balance increases over time), as this balance increase happens on L1, handled by the token contract. So, on L2, your investment (wstETH) balance will remain the same but the value increases in your chosen currency, i.e. dollars. 

How Lido access works via Argent on zkSync

ZkSync is just getting started and smart contracts are coming with version 2.0 in 2022 - until then, we’ve partnered with leading DeFi providers to bring a selection of popular investment options and utilize atomic swaps on zkSync - a trustless, peer-to-peer way to swap tokens between two parties. 

Disclaimer: This blog post is for informational purposes and is not financial advice. Investing in cryptocurrencies and DeFi involves risk and can result in you losing money. 

Further reading

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