What is hETH?

Hord stakers deposit ETH into the deposit pool, which enables a node operator to create a new Beacon Chain validator. At Hord, you can stake as much as ETH as you’d like. There are no minimum requirements.

In doing so, you will be given a token called hETH. hETH is an ERC-20 standard token based on Ethereum. hETH represents both how much ETH you deposited and when you deposited it combined with rewards. The ratio includes rewards that Hord node operators earn from:

• The Beacon Chain itself

• Priority fees from block proposals

• MEV rewards from block proposals

More specifically, the value of hETH is determined by the following ratio:

hETH price in ETH = (amount of ETH deposited + ETH rewards generated) / amount of hETH minted

The Hord platform provides stakers with Beacon Chain rewards, priority fees and MEV rewards that continuously accumulate. As such, the value of hETH is anticipated to grow consistently versus ETH’s value. Below is a chart displaying the growth in hETH’s price between the dates of February 10, 2023, and October 15, 2023.

The value of hETH is updated periodically and under certain circumstances where its price increases by a certain percentage.

To illustrate how it works, let's take a look at a simple example.

Assume you stake at the beginning when 1 ETH is equal to 1 hETH. You deposit 10 ETH and get 10 hETH in return.

As time passes, the balances on the Beacon Chain increase due to validator rewards. Suppose 128 ETH was staked with Hord, and the total of all validator balances on ETH2 was 160 ETH. In that case, 1 ETH would be valued at (128/160) = 0.8 hETH, and conversely, 1 hETH would be worth (160/128) = 1.25 ETH.

At this point, you could exchange your 10 hETH back to Hord's smart contracts and get 12.5 ETH in return.