Before the Ethereum merger, Coinbase announces a staking token for wrapped ether.

Coinbase Wrapped Staked Ether, often known as "cbETH," is a new liquid staking token that has been introduced, according to the cryptocurrency exchange Coinbase. Customers who stake Ether on Coinbase will be able to purchase the cbETH, an ERC-20 utility token. Other users have the option to withdraw their Ether from Coinbase, stake it, and then convert the ETH2 into cbETH. According to Coinbase, all ETH that has been staked has been locked until the Ethereum protocol is upgraded. Just three weeks before the planned Merge upgrade on the Ethereum mainnet, the announcement was made.

Customers will have the option to sell, transfer, spend, or otherwise use their staked-ETH while it is locked thanks to the cbETH token. Coinbase included the following details in the blog post: "We anticipate that cbETH will be widely used for trading, transferring, and DeFi applications. Through the development of high-utility wrapped tokens and the open sourcing of smart contracts, Coinbase hopes to contribute to the larger crypto ecosystem via cbETH."

The exchange noted that, out of prudence, "On the Ethereum network, Coinbase will introduce support for Coinbase Wrapped Staked ETH (cbETH) (ERC-20 token). Sending this asset through other networks will result in the loss of your money."

Additionally, according to Coinbase, the cbETH does not track the price of ETH 1:1. It only reflects staked ETH plus all accumulated staking interest. There may be "a divergence in pricing for these assets over time" because each cbETH token represents more staked ETH.

Last year, the exchange began allowing retail players to stake Ether. Additionally, they began supplying institutional participants with ETH staking earlier this month.

The ultimate date for the Ethereum Merge update is becoming fairly close. There will be two separate occurrences of the Ethereum Merge event. On September 6, the Bellatrix upgrade will take place on the Beacon Chain. On September 15, the execution layer will also receive the Paris upgrade.