After confirmation of the Ethereum 2.0 Genesis block in the test network, an enthusiast of this platform started a profitability calculator for the PoS consensus protocol (proof-of-stake) or the proof of participation.
Before we go into details, it should be noted that the results of this calculator are not effective since it is not the final version of the Ethereum 2.0 network, but only a test and development network, as announced in the last few days.
The tool can be found on the EthereumPrice.org website. and this enables calculation of the reward generated by earning Mark out (participation) up to 10 years in the Ethereum networkto be able to emulate the results by inserting various variables. For example, you can specify how long a validator node remains active, how much ETH is stored and what hypothetical price the cryptocurrency has in fiat currencies such as USD, EUR and JPY, among others.
The site also explains that the amount of ETH retained plays a fundamental role in calculating the annual return of the validation nodes, because “the higher the percentage of retained ETH (in relation to the total circulation of the cryptocurrency), the lower the return on it Investment. ”You therefore remember that the reward will only be released when it reaches the remaining amount of 524,288 ETH in the PoS.
The data is extracted from ConsenSys, the incubator for the development of Ethereum. However, the computer has no formal relationship with the company and is a user interface that can be freely implemented in other environments. The method behind how the calculator works is a Google spreadsheet created by Colin Myers of ConsenSys Codefi.
As we can prove, the annual return for maintaining 32 ETH is when a validator node is available 99% of the time, with the price being taken into account by the tool (USD 193.34) it would be approximately $ 7,080 in the first year and $ 23,514 in 10 years. The annual interest would be 14.26%.
However, they make it clear that the calculator does not include operating costs for operating a validation node, although this price is relatively low.
Operating costs to consider include storing a virtual private server (VPS) for home environments, or buying hardware such as the Raspberry Pi and paying for power consumption. The cost of operating an Ethereum validation node on the proof of stake is low compared to the cost of maintaining a proof of work miner.
The calculator has a telegram group in which doubts are clarified and discussions about Ethereum 2.0 are held.
The Ethereum 2.0 test network released its Genesis block on April 16, as announced by Prysmatic Labs, which is behind its development. This update to the well-known protocol changes the consensus algorithm from Proof of Work to Proof of Participation, which is used by other platforms such as Cardano to simplify the operation of the network and promote the conditions for its constant upgrade and reduction of transaction costs.
Currently, according to the EtherScan.io browser, the Ethereum 2.0 test network has approximately 22,800 active validation nodes, which can have up to 32 ETH as effective participation, but only receive the reward that corresponds to their work for no more than this amount. from the ETH.
In the meantime, all preparations for the final start of the network are being made. The programs offer up to $ 10,000 to detect protocol errors.