Grayscale Follows Tesla by Splitting Ethereum Shares – securebitcoinnews
Crypto investment firm Grayscale has announced a share split of its Ethereum Trust Fund (ETHE), offering eight additional shares for each share currently held by shareholders.
Beginning Dec. 17, the outstanding number of shares for Grayscale’s Ethereum Trust will increase from 29.5 million to 265.5 million. Grayscale’s decision should enhance the marketability of its’ Ethereum shares by making those shares cheaper.
Currently, one ETHE share represents 0.09284789 Ethereum tokens (ETH). After the split, the share will be worth 0.01031643 ETH, but the shareholders will retain their total value in the exercise. A 9-for-1 split would effectively reduce a $100 share price to $11.12, and a shareholder with ten shares will now hold 90 units.
Grayscale’s ETHE shares are currently changing hands at $108.8 with a year-to-date increase of 350%, with plenty of interest from retail investors.
In the equities world, a company can issue a scrip issue or bonus issue to existing shareholders for free.
This does not add or take away value from the total asset under management. Instead it means that the shareholders hold a greater number of units, while the cost of each share decreases according to the supply ratio. Investors’ total portfolio value and percentage holdings in the trust remain the same.
While a scrip issue may seem like a redundant exercise, it is taken as a sign of bullishness in traditional markets, and the reduction in share prices makes it more affordable.
The practice has been carried out by high-profile companies recently. For instance, when Tesla announced a stock split on Aug. 11, the news caused stock prices to appreciate by 70% before the split took effect on Aug. 31. Given that Grayscale has chosen to imitate the model, that could be a good sign for its future value.
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Hundreds of Ethereum 2.0 Validators Get Slashed
Ethereum 2.0 has been running very smoothly so far, finalizing with a participation rate of some 97%, far higher than in any testnet.
The network is also doing a great job at keeping misbehaving validators in line for any transgression outside the rules of the code.
In fact more than 600 validators have been slashed so far, just a day after the new ethereum 2.0 Proof of Stake (PoS) blockchain went live.
The biggest slashed amount so far is just 0.23 eth, or about 0.7% of the 32 eth staking amount.
That’s just one person however and the first one to be slashed, with most losing ◊0.0136 and below.
On the other hand, thousands are making money with the biggest being at 0.0806 eth in just one day out of 32 eth, while the rest seem to be at 0.02 and below.
But the amount of slashing in just one day may indicate some are not appreciating the competitive nature of staking.
There have been some 21 forked blocks so far on ethereum 2.0, with one being forked as soon as the fifth epoch.
Then there are attestations. Wrong attestations can get slashing with the network not distinguishing between intentional misbehavior and accidental mistaken vouching.
For example according to Justin Drake, an eth 2.0 researcher, a validator got slashed for a block equivocation, that is the validator was telling different things with Drake presuming that is because he was running fancy validator redundancy that could bypass the slashing protections.
He however lost ‘only’ that 0.23 eth because “slashing penalties are designed to be lenient for isolated offences like these,” Drake says before adding:
“Mass slashings are heavily penalised (if X% get slashed they lose ~3X% of their balance)… also the minimum slashing amount was reduced for genesis and will be increased back to 1 ETH.”
Then there’s propagation. Connecting to as many peers as possible is good because you get a better view of the network, but that’s if your bandwidth can handle it.
Delays in propagating can lead to others taking your slot, meaning you lose the reward, and if you’re behind you may even make incorrect proposals, which gets you slashes.
All suggesting staking is not a very easy game even when it’s just you misbehaving usually unintentionally due to connection problems or due to trying to be too clever with fancy redundancy.
However the vast majority are making money. So while 600 validators might sound like a lot, it is still a small percentage of 21,000 validators currently running the ethereum 2.0 network and it is just a indication that all is running as it should.
Ethereum 2.0 still has a long road ahead, MEW founder says
Ethereum 2.0 launched its Beacon Chain on Tuesday, marking the project’s transition to a proof-of-stake, or PoS, mining algorithm. With Phase 0 now in the rearview mirror, the founder and CEO of MyEtherWallet, Kosala Hemachandra, recently explained the next hurdle for Eth2.
“I think the question should be, what is not the next hurdle for ETH 2.0,” Hemachandra told Cointelegraph, adding:
“Basically, after the beacon chain launch, Ethereum will focus on phase 1 specs. It will go through a lot of iterations similar to phase 0 and tons of bug fixes. It is hard to define a specific issue as the next hurdle since there will be a lot.”
Aimed at scaling the Ethereum network, Eth2 results from years of work and numerous delays. Most recently, facing a Nov. 24 deadline, validators deposited enough total Ether (ETH) coins to enable Tuesday’s Beacon Chain launch, thanks to several last-minute transfers. Phase 1 comes next in Ethereum 2.0’s progression, which Hemachandra believes may not finish until the end of next year.
“With what I’ve seen in the past, I believe ETH 1 will take approximately 1 yr, then 1.5 should take another 6 months,” Hemachandra said. “Phase 2 might take at least 1.5 yrs.”
Hitting the Nov. 24 deadline means validators locked up at least 524,288 ETH total across the board. Since then, that number has grown to more than 900,129 ETH. With the asset trading around $600 at the time of publication, 900,129 ETH totals roughly $540 million.
Given that ETH is a tradable asset involved in the whole ordeal, one might wonder how its price plays into the progression of Eth2. “One thing I like about Etereum developers is the fact that they don’t depend on the price of ETH,” he said, adding:
“Everyone I know is equally motivated towards accomplishing and advancing ETH2 to the next phase. ETH price went through various phases with ups and downs; however, Ethereum development has always been very consistent. I believe it will continue to be like that, and ETH price won’t play any role in the development of Ethereum 2.0.”
In line with Eth2’s transition to PoS, Coinbase recently announced its plan to launch Ethereum 2.0 staking sometime next year.