cbETH is Coinbase's liquid staking token for ETH, allowing Coinbase users to participate in Ethereum staking while maintaining a liquid token that can be transferred, traded, and used in DeFi protocols. As the product of the largest US crypto exchange, cbETH benefits from Coinbase's regulatory credibility and integration with Coinbase Wallet, Coinbase Prime, and Base chain.
cbETH Mechanics
cbETH is a non-rebasing token that appreciates in ETH value over time. Users convert ETH to cbETH through the Coinbase platform at the current exchange rate (which increases daily as staking rewards accrue). cbETH can be redeemed back to ETH at any time without a waiting period (Coinbase manages the underlying withdrawal queue).
Coinbase charges a 25% commission on staking rewards — significantly higher than decentralized protocols (Lido: 10%, Rocket Pool: 5–20%). This premium reflects the convenience of Coinbase's custodial model, instant liquidity, and regulatory compliance.
Regulatory Compliance
cbETH is one of the few LSTs with explicit regulatory consideration from its issuer. Coinbase is a publicly traded US company operating under SEC oversight. cbETH was the subject of SEC scrutiny in 2023, with the SEC alleging it constitutes an unregistered security — a case Coinbase is contesting. This regulatory clarity (or uncertainty) affects cbETH's DeFi integrations.
cbETH in DeFi
Despite the higher commission, cbETH is widely accepted in DeFi. Aave, Compound, and Morpho all accept cbETH as collateral. cbETH is deeply integrated in Coinbase Wallet's DeFi interface, making it the natural starting point for Coinbase users entering DeFi.
Base Chain Integration
cbETH bridges natively to Base (Coinbase's L2), where it serves as a primary yield-bearing collateral asset. Several Base DeFi protocols are built around cbETH, and Coinbase has financial incentives to promote cbETH adoption on Base.