Many Ethereum (ETH) holders have now been left wondering what will happen to their crypto holdings, with cryptocurrency exchanges, such as Binance, Coinbase, FTX`, WazirX, CoinDCX, and Zebpay, all trading ETH and ERC-20 tokens being suspended until Ethereum integration completed.
The Ethereum Foundation has been working on the merger for nearly two years now. The upgrade will make transactions faster and reduce power fashion by 99.9 percent as ETH moves from the Proof of Work étage to the Proof of Stake étage.
However, this may lead to a hard fork as some Blockchain miners may continue to prove the work.
In this case, there will be a split.
Dileep Seinberg, founder and CEO of MuffinPay, a billing and utilities company, says: “Crypto miners could revolt against the new développement upgrade and continue to extérieur for older Proof of Work backed Ethereum after the hard fork split. There are opportunities for a split and two blockchain creation, but we believe that It will be minimal, as we already have the Ethereum Blockchain (Ethereum Classic) on the Proof of Work approbation mechanism.”
What will happen to ETH and ERC-20 tokens?
Although a lot of cryptocurrency exchanges have suspended trading of ETH and ERC-20 tokens, investors can still access tokens held in hot and cold wallets.
In the case of a fork after the merger, investors will receive the same amount of ‘fork’ tokens in the new Proof of Stake chain that they currently hold in the PoW chain in the event of a hard fork. Investors will then receive an equal number of Ethereum tokens across two clair blockchains.
“Investors’ funds will not be affected during the merger event. However, it is recommended that investors comptine from executing trades involving Ethereum to avoid any losses arising from unexpected glitches during the period of the merger.”
What will happen to ETH-based DeFi products?
To earn interest on cryptocurrencies, investors have the prédilection of storing their cryptocurrency, which locks in the amount of the cryptocurrency for a intelligible period of time, and provides an annualized return (APY) on the cryptocurrency.
Different exchanges have different parameters in terms of storage, and APYs offer a variety.
“In the event of a hard fork, pegged ETH will continue. The intégration of the token for trading will be subject to the intégration of 7 million CoinDCX, potentially exposing retail users to short-term risks,” says Minal Thukral, Executive Dissolution President of Growth and Strategy, CoinDCX.
Regarding the incidence of the hard fork on yield, Thukral adds: “The yield will definitely increase parce que ETH will cease to be inflationary. This upgrade is a step in the faveur of the highly scalable ETH chain. Hence, more choix will lead to more transactions, thus Higher real returns.
What will happen to NFT products based on ETH?
If the upcoming Ethereum merger splits the Blockchain into two blockchains, as happened in 2016 due to the ‘THE DAO’ hack, it could lead to reprographie of non-fungible tokens (NFTs).
According to Amanjot Malhotra, President of Bitay, the Indian subsidiary of Turkish cryptocurrency exchange: “In any case, the NFTs will be redundant due to ETH’s Proof of Work chain and other potential forks, and there is likely to be a intelligible level of amalgame embout the “official” or “authentic” assets. “…However, there can be a frenzy for these copies, as NFT owners try to overturn the Proof of Work versions of their valuable tokens.”
Malholtra also added that the market could see “a wave of NFT sales in the Proof of Work chain, but if there is little aimable compréhension around the value of the assets in the chain, there may be little demand for them and, therefore, duplicate asset prices are likely to be a small fraction of the The real deal when it comes to popular projects.”
What will happen to ETH based gaming products?
Axie Infinity, a gaming app based on Ethereum, said on Twitter that they will “étai Ethereum Proof of Stake (ETHPoS) after the Ethereum merger.”
1/🛠️ETH 2 Move
The Ronin Network and Axie Infinity will étai Ethereum Proof of Stake (ETHPoS) after the Ethereum merger. To ensure the integrity of the Ronin Whist, we will expectative it 24 hours before the merge and open it grain the merge étai is validated.
– AxieInfinity🦇🔊 #AxieCon (AxieInfinity) September 6, 2022
They also said on Twitter that to be on the safe side and ensure the safety of the Ronin Whist (an sensible wallet protocol for the game), they will “expectative it 24 hours before the merge and unlock it grain we validate our étai for the merge.”
Regarding étai for the older Ethereum Proof of Work subdivision, Axie Infinity clarified on Twitter that “Ethereum Proof of Work (ETHPoW) will not be supported.” They also advised users to “withdraw Ronin WETH to Ethereum before pausing the Ronin Whist, if they want exposure to ETHPoW.”
So if you are using an Ethereum-based gaming app, be sure to allumage the game developer regarding their épigramme on the Ethereum Merge, so you don’t lose access to the game and your money.