That you can passively earn money with proof-of-stake is a fact. The possibility of staking your own coins – be it Cosmos, Tezos or a PoS coin – and earning an annual return is a welcome opportunity for many investors. With the upgrade to Ethereum 2.0, it will soon be possible to increase your own ETH and thus earn an additional dividend.

But as is so often the case: where money can be earned, fraudsters are not far away. The current example is an Ethereum 2.0 Scam, which is supposed to generate a guaranteed annual return of 100%.

Ethereum 2.0 and proof-of-stake

If you are currently searching the internet for Ethereum 2.0 and proof-of-stake, you may find a ‘pretty’ looking websites. You won’t believe your eyes, because the offer presented on the website seems more than tempting.

Interested investors can participate in Ethereum 2.0 staking starting at 0.2 ETH (approx. 30 USD). This is ‘special’ in that investors usually need at least 32 ETH to participate in the planned proof-of-stake rewards of Ethereum 2.0.

A guaranteed minimum annual return of 100 percent

In addition to this, a guaranteed annual return of at least (!) 100% is promised on the website. It almost goes without saying that the return is even higher if you deposit more ETH for the Ethereum 2.0 staking. Take a look for yourself:

Those of you who have been toying with the idea that this might be real, I’m afraid I have to disappoint you. This is a very clear scam. Besides the arguments just mentioned, I will show some Red Flags in a moment. Especially interesting is the ‘mysterious’ statement on the page, which should call for the use of the own staking service. So they say:

For most blockchains, which are based on a PoS algorithm, you can determine the number of your coins yourself. But normally you can’t get the maximum profit out of it. Your bet must be connected to the network at all times. Even a short interruption of the connection can interrupt you in your goal of making money.

How fortunate that the solution for this is about to be presented to us. No, seriously. Even if the arguments mentioned so far should already be sufficient, let’s have a look at more Red Flags.

Currently, there is no possibility to do staking in Ethereum 2.0 at all. The proof-of-work algorithm still applies.

A guaranteed minimum annual return of 100% is an illusion. According to the trustworthy website stakingrewards.com, the expected return should be around 8% per year.

The project issues the source code used by Ethereum on Github as its own code.

To show how ‘successful’ the project has been so far, the scammers use a screenshot from the MyEtherWallet address.