With Ethereum's shift to proof-of-stake (PoS), staking ETH has become an appealing way for crypto holders to earn passive income. However, users of hardware wallets like Trezor who want to keep their assets secure are increasingly turning to third-party providers to stake their ETH. Unfortunately, as some users on forums like Reddit’s r/TREZOR and Trezor’s official community forum have shared, this approach can have unexpected downsides. This blog post will explore the potential pitfalls of staking ETH on Trezor with third-party providers like Everstake and why it might be best to avoid this route.
1. Long Wait Times and Uncertainty in Pending Status
Many Trezor users have reported delays in getting their ETH staked when using Everstake as their staking provider. One user shared their frustration with a transaction pending for over three days, even though the estimated wait time was only one day (source). In the world of crypto, where time is money, this uncertainty can be nerve-wracking, especially when other staking options might offer quicker onboarding.
If you’re relying on timely staking rewards or aiming to move quickly to adjust your staking strategy, these extended wait times could lead to missed opportunities or extra stress.
2. Limited Support and Transparency
Some users have highlighted the limited information available during the staking process. Everstake, like many third-party providers, doesn’t always provide clear updates about estimated waiting periods or delays. This lack of transparency can be frustrating, as users are left wondering if their funds are safe and when the staking will begin.
Additionally, third-party providers might not have robust customer support. In cases where funds are delayed or users encounter other issues, getting a prompt response or resolution can be challenging. Without a direct line of support, users may have to rely on forum discussions, which aren’t always helpful or quick in addressing urgent concerns (Trezor forum).
3. Security Risks and Third-Party Dependence
The main reason crypto enthusiasts choose hardware wallets like Trezor is to secure their assets from external threats. However, staking ETH on Trezor with a third-party provider reintroduces some risk by requiring users to entrust their funds to an external party. Some community members have voiced their reluctance to stake via third-party services because of this added risk. One user even cited past losses with other platforms, warning that “just an instance” of mishap or malfeasance could wipe out significant funds.
By staking through a third party, you introduce counterparty risk: you’re no longer the sole custodian of your assets. If the provider faces an issue—be it technical, financial, or legal—you could face losses or delays in accessing your staked assets.
4. Growing Validator Queue Times and Higher Competition
The popularity of staking on Ethereum’s network has led to a higher number of validators and a growing queue for staking positions. As mentioned in user comments on Reddit, there’s been an uptick in staking activity, which could contribute to wait times as more validators join the network.
While this surge speaks to the network’s growth, it also means that smaller validators or those using third-party providers may face additional delays compared to larger staking pools. Unfortunately, Everstake users might have to wait longer as they navigate this crowded space.
5. Alternatives to Third-Party Staking
If you’re considering staking your ETH, there are alternatives that may better align with your desire for control, security, and timeliness. Some options include:
Direct Staking with Trezor (DIY Node): Running your own validator node is the most secure method, though it requires technical knowledge and 32 ETH. This gives you complete control over your staking process.
Staking Pools with Reputation and Liquidity: If you don’t have 32 ETH or the technical skills to run your own node, consider using highly reputable and well-known staking services. Platforms like Coinbase, Kraken, and Binance offer staking services that tend to be more transparent and reliable, with robust customer support.
Decentralized Staking Pools (e.g., Rocket Pool): Decentralized options like Rocket Pool allow users to stake smaller amounts in a more community-driven framework. These options provide a middle ground, allowing you to participate without surrendering control to a single centralized entity.
Final Thoughts: Consider the Risks Before Staking ETH on Trezor
While staking ETH offers passive rewards, the process can be challenging and risky, especially if you’re relying on a third-party provider like Everstake. Before jumping into ETH staking on Trezor or any other hardware wallet, weigh the pros and cons carefully. Prioritize options that give you control, transparency, and security, and consider alternatives to third-party services where possible.
By understanding the risks and doing your due diligence, you can make an informed decision and stake your ETH with peace of mind.