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After Ethereum is forked, addresses holding ETH will receive the same amount of ETHW on the forked blockchain.
Ethereum is switching to Proof-of-Stake, but miners are planning a Proof-of-Work fork.
An anonymous group of developers, supported by many large Ethereum miners, have hard forked the Ethereum blockchain after next week’s merge, running a version of the network on the current Proof-of-Work (PoW) consensus mechanism. Continuing, the main blockchain is Proof of Stake (PoS).
The fork, commonly called ETHPoW, shares the same transaction history as the main Ethereum network, but will start creating its own blocks after the Merge update takes effect. A PoW fork starts from the pre-merge state of the Ethereum network, so all token balances and smart contracts are carried over as well. This means that everyone holding her ETH on the chain will have an equal balance of her ETHW on her forked ETHPoW chain. ETHW is only native to his PoW fork and represents a completely different asset than his original ETH on Ethereum.
For many Ethereum devotees, the planned PoW fork is of little interest as an investment. With virtually all DeFi, NFT, and network infrastructure protocols publicly announcing support for PoS chains, PoW forks are in a tough spot. After launch, decentralized exchanges on the fork will cease to function, centralized stablecoins such as USDC and USDT will become worthless, mass liquidations will occur, and many of his DeFi protocols could be broken. .
A PoW fork has to start from scratch, but there is one token that is likely to hold some value. It’s ETHW. Like his DAO hack fork in 2016 that created Ethereum Classic, the PoW fork has loyal followers who continue to develop it, which could create demand for its token. Conversely, someone who believes the fork is going nowhere may want to sell their ETHW tokens after the merge for some additional profit. Are you sure? Which exchanges plan to support Ethereum PoW forks? Read on to get the most out of Merge and PoW forks.
The easiest way to play Merge is to deposit ETH into centralized exchanges that have announced support for PoW forks. The list below is not exhaustive, but it covers the major exchanges that have issued statements.
Currently, Poloniex, Binance, MEXC Global, and Gate.io appear to be the most certain to offer users equivalent ETHW after the merge. Of these, Binance is currently the top centralized exchange by trading volume, so it may have the largest market.
However, if you are unable or unwilling to deposit your ETH on one of these exchanges prior to the merge, you have another option. Holding ETH in a non-custodial Ethereum wallet guarantees that the address will receive his ETHW in the new PoW fork.
A non-custodial wallet is the fastest way to access your ETHW after merging. Users of centralized exchanges may have to wait hours or days for their ETHW to reflect in their accounts, but managing their ETH funds is the surest way to guarantee access to their PoW fork coins. That’s the way.
However, the trade-off is that accessing new PoW chains requires technical knowledge and may expose users to risk. Those who take this approach will need to add to their EVM wallet once the PoW network is up and running. In MetaMask, click Network at the top of the browser extensions,[]You can do this by choosing Next, you will need to enter your ETH PoW chain name, RPC URL, and chain ID (these details will be announced after the PoW chain launch). The process is relatively straightforward and similar to adding RPC to other Ethereum compatible chains such as Polygon or Avalanche.
Another consideration for those planning to self-manage ETH prior to a merger is consolidation. If ETH is locked in a smart contract, placed on a Layer 2 chain, or staked via a protocol like Lido, it will not match his ETHW on the PoW chain. To maximize the amount of ETHW you receive, we recommend converting your assets to regular his ETH and keeping them in your wallet for the merger.
Using a non-custodial wallet ensures that you receive your PoW fork coins, but the limiting factor is finding a market to sell them after the merge. Using a decentralized exchange is out of the question as all tokens on the forked chain except ETHW will almost certainly be worthless. Those who want to cash out will have to wait for the centralized exchange to open her ETHW deposit.
To ensure readiness, consider setting up accounts on various exchanges that support ETHW in advance. That way, those who want to move their ETHW to the earliest opportunity may be able to sell it for a higher price.
Finally, it is essential to understand the risks associated with Merge and new PoW forks. 1 well-known danger This means that if a fork of Ethereum launches with the same chain ID as the main PoS chain, the transaction may be “relayed.” This is where transactions signed on the forked chain can be verified on the main he Ethereum PoS chain, enabling new scams that can drain users’ wallets.
While such scams are possible, it is doubtful whether PoW forks will launch with the same chain ID. However, malicious individuals may attempt to start other forks designed to steal a user’s PoS ETH. Be very careful before signing a transaction with your ETH fork. If in doubt, do nothing. Better to miss a few hundred dollars than lose an entire stack of ETH.
The latest estimates predict that the merger will take place between September 13th and 14th. If you plan to send ETH to a centralized exchange or your own wallet, do so well in advance.most exchanges Stop ETH transaction Don’t leave it till the end as we will ensure that users don’t lose their funds hours before the merge.
Whether you’re sticking with an exchange or planning to self-manage your ETH, double-check everything and stay safe before submitting a transaction.
Disclosure: At the time of writing this article, the author owned ETH and several other cryptocurrencies.
